IFC, the private sector arm of the World Bank, may invest up to $20 million in Nereus India Alternative Energy Fund LLC, a newly formed fund which will target companies engaged in the development, construction & operation of renewable and clean energy generation assets or those focused on the deployment of clean energy technologies in India.
The total target size of this fund is $250 million and it will be domiciled in Mauritius. The anticipated portfolio of Nereus will include 7-10 investments of $15 million-$35 million each, in equity and equity-linked securities of companies primarily focusing on the development, construction and operation of power generation assets in India.
The fund will be managed by Nereus Capital Management, LLC. Nereus Capital Advisors Pvt Ltd, an Indian private limited company, will provide investment advisory services. The advisor’s professional team is currently split between Mumbai and Delhi.
In May last year, Nereus Capital roped in Rajesh C. as its managing director. Prior to joining Nereus, he had served as head of investments at PTC India Financial Services Ltd and Green Infra Ltd (an Indian renewable energy producer).
Nereus Capital is currently investing from its India Energy Fund and typically puts $5 million-$25 million in equity or equity-linked securities of clean and renewable power generation companies.
IFC has been one of the more prolific investors in cleantech space and has also been supporting other PE/VC funds. Earlier this year, it said that it would provide $5 million or Rs 25 crore in debt-financing to Mahindra Solar One Pvt Ltd for a 5 MW solar power project in Rajasthan. Mahindra Solar One is a joint venture between the Mahindra Group and Kiran Energy, a Mumbai-based solar power company founded by Ardeshir Contractor (former head of KPMG’s investment banking business in India) and Alan Rosling (a former executive director of Tata Sons). Other promoters include IIT Mumbai faculty members Dr Sunit Tyagi and Dr Hemanshu Bhatt who have expertise in the solar sector.
Kiran Energy is backed by private equity players New Silk Route, Bessemer Venture Partners and Argonaut Private Equity.
Last June, IFC invested $4 million in Sapphire Industrial Infrastructures Pvt Ltd, a subsidiary of Moser Baer Clean Energy Ltd. Sapphire is constructing a 5 MW solar plant at Sivaganga in Tamil Nadu. IFC has also put money in three other solar power-related firms in India in the past two years. Two of these companies are NDPL Solar and Azure Power.
IFC also said that it was supporting Pragati India Fund, a private equity fund focusing on the eight poorest states in India, with $20 million or up to 20 per cent corpus of the fund.
Pragati India Fund Ltd is aiming to raise between $75-100 million, and will focus on the economically underdeveloped, low-income states of India, such as Bihar, Jharkhand, Uttar Pradesh, Madhya Pradesh, Chhattisgarh and Orissa.