Brookfield raises US$7B for impact fund with Ontario Teachers’, Temasek

LARGE-SCALE INVESTMENTS

THAT ADDRESS CLIMATE CHANGE

AND GENERATE ATTRACTIVE

RETURNS. — MARK CARNEY

Brookfield Asset Management Inc. said it has raised US$7 billion for the initial close of its new impact investment fund, pulling in money from Singapore’s sovereign wealth fund and Canadian pension managers for an investment vehicle that will help businesses cut their carbon emissions.

The Toronto-based alternative asset manager said it plans to raise as much as US$12.5 billion for the Brookfield Global Transition Fund, which would make it the largest of its kind to date.

Ontario Teachers’ Pension Plan Board and Singapore’s Us$281-billion Temasek Holdings will be significant initial investors, Brookfield said in a statement. Canadian pension funds PSP Investments and Investment Management Corp. of Ontario have also made meaningful commitments to the fund, Brookfield said, without disclosing how much each is contributing.

Brookfield wants to help accelerate the transition to net-zero emissions globally and will draw on its experience in renewable power and clean energy to guide its investments, said Mark Carney, the former Bank of England and Bank of Canada governor who is now Brookfield vice-chair and its head of transition investing.

“As the world increasingly focuses on sustainability, the required capital and investable opportunities are expanding faster than originally expected, creating an even greater opportunity for large-scale investments that address climate change and generate attractive returns,” Carney said in the statement.

Brookfield is just the latest firm to raise capital for an impact fund. Apollo Global Management Inc. is seeking to raise as much as US$1.5 billion for a new fund that will focus on socially-responsible investments, people familiar with the matter told Bloomberg News this week.

That follows on moves by other private equity players, including KKR & Co., TPG and Bain Capital, to jump into the sector in response to increased demand from institutions. Last year, private equity firms raised almost US$4 billion for impact funds, the most for the strategy since 2017, according to data provider Preqin.

Carney said earlier this year that Brookfield was seeking to raise at least US$7.5 billion for its initial fund.