Taaleri launches €80m bioindustry vehicle

Finnish investment and asset manager Taaleri has launched an €80 million bioindustry vehicle, which is a first of its kind for the firm.

Taaleri Bioindustry I will pursue circular economy investments in areas such as sustainable textiles, metal recovery, biodegradable plastics and organic fertilizers, bioindustry director Tero Saarno told Agri Investor.

The vehicle is one of the first Finnish private equity funds to be classified as ‘dark green’ under Article 9 of the EU’s new Sustainable Finance Disclosure Regulation.

“We invest in factories that are utilizing bio-based raw materials, or non-virgin raw materials,” said Saarno. “For example, Trace Kroll is an organic fertilizer producer. It goes into the circular economy scope because the raw material for that fertilizer is actually used alkaline batteries. So, we are taking hazardous waste and turning that into organic fertilizer for crops.

“We are investing into production facilities that this company will then build in the next phase. They already have one working production facility here in Finland, but of course the idea is to scale the production up in Europe.”

The vehicle has a €120 million hard-cap and a 10-year life. It will seek to make four to six investments across its chosen bioindustry sectors.

Saarno confirmed that Taaleri will seed the vehicle but he declined to disclose the size of the commitment. He added that the seed capital will be “significant” and that is the approach taken by the firm when it launched its first wind and solar vehicles.

Investors into the fund are expected to primarily be made up of family offices and high-net-worth individuals, with Finnish bank Aktia having exclusive distributions rights in the country.

“This is a growth equity fund that will invest into proven technologies when they are ready to be scaled up. We are not investing in pure technological companies that need demo facilities or pilot factories. We are investing into the first or second industrial scale production facilities,” Saarno explained.

“We will be generating profits for the investors and we can promise quite lucrative IRR for the investor. The base case is net 15 percent which is really good for Article 9 dark green product.”

Taaleri has €2.1 billion in assets under management, according to the company’s website. The firm has a decades long track record of investing in renewable energy and is listed on Nasdaq Helsinki.