Global sustainable infrastructure investment firm Denham Capital has entered a $2.1bn strategic partnership with American insurance firm Aflac Global. The collaboration will seek to accelerate Denham’s Sustainable Infrastructure Platform, as well as fund the firm’s next equity fund.
The platform has an emphasis on sustainable infrastructure investments, drawing on Denham’s prior industry knowledge, with the lion’s share of investments anticipated to focus on renewable power and energy storage solutions.
“Now is the optimal time for this transaction as we look to provide solutions across all parts of the capital structure,” said Denham CEO Stu Porter in a statement. “The partnership with Aflac will trigger the rapid growth of our Sustainable Infrastructure platform, enabling Denham to play a pivotal role in accelerating the transition toward an electrified, clean economy.”
“Global demand for assets which fulfill ESG objectives has significantly bolstered the need for investing in sustainable infrastructure, and as such, we expect energy transition initiatives and investment into sustainable infrastructure to increase materially well into the future,” he added.
Indeed, the Sustainable Infrastructure sector is expected to reach $100trn-$150trn in value by 2050 as global economies ramp up environmental efforts to attain Paris Agreement targets. Denham intends its platform to meet this growing demand, providing a resource for assets that look to both aid economic growth while maintaining environmental sustainability.
All investments considered for the platform will be assessed against Denham’s screening and ESG scoring methodology, which determines whether they support ‘climate change mitigation, natural resource conservation, pollution prevention and control, and digital connectivity.’
As of December last year, Aflac’s investments into sustainable technologies and solutions was estimated at more than $1.7bn. The firm has previously expressed its long-term growth strategy of identifying and supporting viable sustainable projects.
“The nature of these asset classes will enable us to capture higher yields while providing enhanced credit protection, adding value to our portfolio and to our stakeholders, while advancing our ESG priorities,” said Aflac executive vice president Eric M. Kirsch in a statement.