Project detail - METIER SUSTAINABLE CAPITAL INTERNAT

METIER SUSTAINABLE CAPITAL INTERNAT

Status: Approved investment
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Disclaimer

The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.

Who is our customer

The Metier Sustainable Capital Fund II is a private equity fund investing in clean energy generating assets and resource efficiency projects and businesses across Africa. The fund is managed by Metier and is expected to reach first close in 2019, having development finance institutions including FMO as anchor investors. Metier Sustainable Capital Fund II is the follow-on fund of the Lereko Metier Sustainable Capital Fund (LMSC).

What is our funding objective?

The Metier Sustainable Capital Fund II targets investments which deliver social and environmental benefits as well as financial returns. The investment mandate is balanced between renewable energy projects (encompassing both grid-tied and distributed generation) and growth capital investments in other resource efficiency sectors such as water and waste, with a unique blend of team skills, experience and networks allowing for a compelling proposition. Compared to the predecessor LMSC, which invested mostly in on-grid renewable energy projects in South Africa, the Fund II will broaden its target sectors and geographic focus across the African continent.

Why do we fund this investment?

By investing in the Metier Sustainable Capital Fund II, FMO seeks to address the market need for energy in Africa in a sustainable and responsible manner, by increasing the production of clean energy and investing in resource efficiency projects. FMO will play an anchor investor role in the Fund II. A successful final closing of the fund means that more risk capital is available for renewable energy and clean technologies in Africa, which is fully in line with FMO's investment strategy.

What is the Environmental and Social categorization rationale?

Metier Sustainable Capital Fund II will actively contribute to sustainable development through clean energy and resource efficiency in low- and middle-income countries in Africa, that will also generate additional benefits for the local society (e.g. employment, CSR investments). The Fund’ current pipeline consists of pan Africa assets in renewable energy (incl. a mini-hydro platform, solar PV and biomass/waste water to energy plants) and resource efficiency. Overall the Fund is deemed to be category A: although the Fund pipeline mainly consists of B and B+ projects, there are some potential category A projects, as well as B+ projects that might materialize to A. Key risks include land resettlement, biodiversity impacts, occupational and community health and safety, and contextual risks. This will be confirmed by asset specific Environmental and Social Due Diligence (ESDDs) (focusing on IFC PS as well as contextual risks and climate resiliency) that will stipulate stringent IFC PS-based mitigation and compensation measures for sound E&S performance. The Fund manages E&S risks and impacts through a mature and IFC PS-aligned ESMS, together with FMO and the other DFI partners who are actively engaged through an ESG committee. The Fund also has established proper ESG reporting procedures and will closely monitor and manage E&S risks and impacts to secure net positive results or proper compensation in line with Good International Industry Practices. Further, FMO will actively engage with the Fund in an effort to identify and materialize asset-specific value add opportunities, including CSR initiatives.

Website customer/investment
http://www.metier.co.za
Region
Africa
Country
Africa
Sector
Energy
Publication date
6/3/2019
Effective date
12/20/2019
Total FMO financing
USD 15.00 MLN
Funding
FMO NV
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
A