Malaysia-based Navis Capital Partners is raising a $300 million private equity fund dedicated to Southeast Asia’s decarbonisation journey, according to a statement by the Green Climate Fund (GCF), which recently approved a $60 million anchor commitment to the vehicle.
Navis Decarbonisation Fund I will invest through hybrid capital instruments into climate adaptation and mitigation in the region, including Indonesia, Malaysia, the Philippines, Thailand, Cambodia, and Vietnam.
GCF said that its commitment to the fund will be deployed in its four target countries of Indonesia, Malaysia, the Philippines and Thailand. Investment in the fund’s other target countries shall be capped at 20% of the overall fund size.
The limited partner said that the fund has already secured a portfolio pipeline, with a water treatment project in Cambodia and a renewable energy project in the Philippines.
Navis Decarbonisation Fund I will invest in growth-stage SMEs in sectors including energy access and power generation, infrastructure and built environment, low-emission transportation, and sustainable agriculture and water.
The vehicle has a 12-year implementation period, and 20 years for a total lifespan.
“The Coverage Countries are characterised by high climate vulnerability, a mix of low- to middle-income economies, significant climate finance gaps, high and growing GHG emissions from key sectors, and national commitments to decarbonization and adaptation that require external support,” GCF said in its report.
Limited private funding and technical capacity are among key barriers to decarbonisation demand; while high upfront costs, a shortage of capable local partners, regulatory constraints, and investor caution toward emerging market risks have slowed adoption, according to the Seoul-based financing agency.
It added that Navis’ decarbonisation strategy aims to provide meaningful DPI to LPs by its fifth year of operation, either through exits or through a combination of alternative liquidity events, such as recapitalisation, dividends or partial sell-down.
Navis Decarbonisation Fund I heightens the private equity firm’s commitment to climate solutions, after its inaugural private credit fund set a focus on sustainable projects.
The firm also joins a slew of Southeast Asia-focused fund managers raising climate funds. Fullerton Carbon Action Fund, a 2024-vintage decarbonisation strategy of Fullerton Fund Management, made a second investment earlier this year.
This month, Circulate Capital secured a $220 million first close of its new $300 million fund. Vietnam-based Mekong Capital also targeted $200 million for its maiden climate fund.
