In June 2018, IFU signed an agreement with PKA, PensionDanmark, PFA, ATP, JØP/DIP, PenSam and Navest to establish the Danish SDG Investment Fund, which will support the UN Sustainable Development Goals through commercial investments. The total capital commitment in the first closing was DKK 4.1bn. In a second and final closing, commitments have been obtained from three additional investors: SEB Life & Pension, Secure SDG Fund and Chr. Augustinus Fabrikker Akts. With these three investors, the total commitment reached DKK 4.85bn, which is very close to the original target of DKK 5bn.
– The fund is an innovative example of public and private capital joining forces to make a difference and at the same time make commercial investments with solid returns. IFU has more than 50 years of experience investing in developing countries and lifting people out of poverty. We see the investment as an important part of our efforts to let sustainable investments permeate our traditional portfolio management, said Rebecka Elkert, Responsible Investment Specialist in SEB Life & Pension.
– We are proud that IFU has provided our customers with a unique opportunity to contribute to the realisation of the UN Sustainable Development Goals combined with an attractive return. Based on IFU’s long-standing track record and co-investments with Danish companies in developing countries, this fund fits very well in with our investment philosophy aiming at offering highly diversified portfolios and being the best supplier of alternative investments in Denmark, said Henrik Sparup, Investment Director in Secure Fondsmæglerselskab and Alternative Equity Partners, which manages Secure SDG Fund.
– We are very pleased to welcome three more investors and complete the fundraising for the Danish SDG Investment Fund very close to the original target of DKK 5bn, said Torben Huss, CEO of IFU.
The Danish SDG Investment Fund was established as a public-private partnership, with the private investors contributing 60 per cent of the capital and IFU contributing 40 per cent. After the second and final closing, the total private commitments are at DKK 2.9bn, whereas IFU’s capital contribution is DKK 1.95bn.
Investments of DKK 30 billion
The Danish SDG Investment Fund will make equity investments in companies in Africa, Asia, Latin America and parts of Europe. It will mainly be in cooperation with Danish businesses, which have strong competencies, knowledge and technology within a number of strategic sectors, which support the realisation of the UN Sustainable Development Goals. The fund will operate on market terms and must provide a competitive return to its investors.
The Danish SDG Investment Fund is managed by IFU, which has invested in more than 1,250 companies in over 100 countries in cooperation with more than 900 Danish businesses. As IFU, the new fund will contribute to mobilizing further capital in the individual companies in the developing countries, and the total investments are therefore expected to be around DKK 30bn.
– Everyone agrees that private capital is required to succeed in realising the UN Sustainable Development Goals in the developing countries, and we are therefore very satisfied that the Danish SDG Investment Fund will contribute to creating a return to its investors as well as improved living conditions for people in the developing countries, said Torben Huss.