JLEN commits EUR 25m to environmental investment vehicle FEIP
By Josh White
Date: Tuesday 28 Jan 2020
(Sharecast News) - Environmental infrastructure fund JLEN announced a commitment of €25m (£21.14m) to Luxembourg limited partnership investment vehicle Foresight Energy Infrastructure Partners (FEIP).
The London-listed firm said FEIP aimed to generate returns from investing in a portfolio of diversified infrastructure assets that contributed to the decarbonisation of electricity networks.
It explained that the majority of investments would be in construction-stage European renewable energy generation infrastructure such as wind farms and solar parks, with FEIP also having an allocation to renewable enabling infrastructure such as energy storage, and transmission and distribution assets that complemented intermittent generation assets.
FEIP had identified an initial portfolio that included European construction-stage wind and solar assets and operational battery storage assets, the board explained.
JLEN said the investment in FEIP would allow it to further diversify its geographic and technology exposure, while also gaining an allocation to construction-stage assets, which was expected to enhance returns.
Given construction-stage assets could only represent a small part of the company's portfolio, the board said the FEIP investment allowed a "greater level of diversification" than would be possible with direct investments, providing for a more attractive risk-adjusted return profile.
JLEN said its commitment to FEIP would also open the possibility of future co-investment opportunities on a selective basis.
It said it would be excused from any FEIP investment that was not consistent with its own investment policy.
Any management fees payable by FEIP in connection with JLEN's commitment would be rebated to JLEN, the board confirmed, with a carried interest due to the manager, subject to a hurdle rate.
"This commitment to FEIP enables JLEN to make further use of its broad environmental infrastructure mandate, gaining exposure to additional European renewables markets and to higher returning construction-stage assets," said chairman Richard Morse.
"Future opportunities for co-investment may also be of interest as JLEN continues to offer investors one of the most diversified propositions in the Listed Renewables sector."
At 1243 GMT, shares in JLEN Environmental Assets Group were down 2.96% at 117.42p.
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