KGAL renewable energy fund hit EUR 382 million at 2nd close

German asset and investment manager KGAL Group has achieved the second closing of its ESPF 4 fund, raising EUR 127 million (USD 154.1m).

Including the EUR 255 million in proceeds from the first closing of the Luxembourg-based fund, the company has secured EUR 382 million in total, with nearly three quarters of the committed equity coming from investors outside Germany, it said on Friday.

ESPF 4 invests mainly in wind, solar and hydropower projects in Europe. The fund, with a tenor of 10 years, has a EUR-500-million equity target and a hard cap of EUR 600 million, which translates into a potential investment of around EUR 1 billion-1.2 billion.

KGAL said it has already entered a share purchase agreement and four exclusivity agreements for solar projects in Spain and Italy of up to 600 MW and is close to investing in Scandinavia onshore wind and hydropower. Other renewable energy, grids and energy storage projects are also within the fund's focus.

The fund’s second close received commitments from five European investors, including two insurers, two pension funds and an investment manager, which come from Germany, the UK, France and the Netherlands. “Pressure to invest is still high and there is a strong appetite in renewable energy combined with a sustainable investment approach,” commented Douglas Edwards, member of the board of KGAL Capital GmbH & Co KG, responsible for international sales.

KGAL raised plans the final closing for ESPF 4 to take place at end-2018.

(EUR 1.0 = USD 1.213)

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