Deals

Asia Climate Partners invests in Indian cold chain company

The Hong Kong-based fund has made its first investment from its debut fund and is expected to reach a final close of $700m by September.

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Reefer containers waiting to board at the port of Barcelona, Catalonia, Spain

Asian mid-market private equity firm Asia Climate Partners (ACP) has made its first investment in India’s cold chain company ColdEX for 2.5 billion rupees ($36 million; €33 million), according to reports.

In  the transaction, ACP has also acquired Mumbai-based India Equity Partners’ (IEP) stake in the company for an undisclosed sum, which IEP had bought in 2010.

ACP structured the deal through its debut fund, Asia Climate Partners, a 2014-vintage vehicle that held a first close on $400 million last year.

The fund targets investments in green energy-related and low carbon businesses including renewable energy, clean technology, energy conservation, water resources, agriculture, and forestry in India, China and south-east Asia.

“ACP currently has $440 million under management and we hope to achieve a final close of about $700 million by September this year,” ACP managing director Anand Prakash said.

Capital commitments were received from the Asian Development Bank (ADB), Japan’s ORIX Corporation and Netherlands-based Robeco Institutional Asset Management and the government of the UK, as previously reported by Private Equity International. Other known investors in the fund are the Bank of Tokyo-Mitsubishi, the Japan International Cooperation Agency and Sompo Japan Nipponkoa Insurance.

“This is the first investment and we hope to follow soon with two other investments in China and India. We look at a minimum transaction size of $20-25 million, but on the other spectrum we are looking at a transaction in India that is about $100 million-$125 million. For those larger deals, we are looking at co-investments with our LPs – we would take half and our LPs would take the remaining investment. This allows us to punch above our weight class because we can go in and take very large positions without being a multi-billion dollar fund,” Prakash said.

ACPs’ competitors in clean energy or low carbon deals in Asia include Olympus Capital, Armstrong Asset Management and a number of clean energy outlets in India.

New Delhi-headquartered ColdEX runs a fleet of 850 refrigerated trucks across India. It will use ACP’s investment to expand its footprint in India and increase its warehousing capacity.

India Equity Partners could not be reached for comment.