BAM - Brookfield Opens Fundraising for Catalytic Transition Fund with Anchor Commitment from ALTÉRRA Targeted to Raise up to $5 billion to Scale Up Climate Finance in Emerging Markets | Benzinga
First dedicated fund introduced for transition investing in emerging markets
$1 billion committed by UAE-backed ALTÉRRA
CTF first close expected by the end of 2024
BROOKFIELD, NEWS, June 13, 2024 (GLOBE NEWSWIRE) -- Brookfield Asset Management (NYSE:BAM, TSX:BAM) ("Brookfield") and Alterra Management Limited announced today the launch of the Catalytic Transition Fund ("CTF" or "the Fund") focused on directing capital into clean energy and transition assets in emerging economies.
With the urgent need to cut emissions and accelerate the climate transition, the Brookfield-managed CTF will harness a $1 billion commitment by ALTÉRRA funds ("ALTÉRRA") to catalyze up to $5 billion in total capital for deployment into emerging markets. Since announcing the launch of CTF in December 2023, Brookfield has been focused on developing the investment strategy, identifying an advanced pipeline of potential investments and pre-marketing to potential investment partners.
Launched at COP28 in Dubai, ALTÉRRA is the world's largest private investment vehicle for climate finance. It responds to the call for more ambitious funding models for the climate transition, particularly in developing countries, and to the urgent need to accelerate and scale climate action. At this critical juncture for driving climate action, ALTÉRRA is committed to deploying $30 billion in climate investments with the goal to catalyze $250 billion with partners by 2030.
Emerging and developing economies outside of China receive less than 15% of global clean energy investment, despite representing nearly one third of global emissions and often yielding greater emissions reductions per dollar invested than in developed countries. To align with the goals of the Paris Agreement, clean energy investment in these markets will need to increase six times over current levels to reach $1.6 trillion per year by the early 2030s.
CTF represents a unique private capital approach to crowd in capital for clean energy and transition assets in emerging markets. Managed by Brookfield and driven by the catalytic capital of ALTÉRRA, it will accelerate decarbonization investments while generating attractive risk-adjusted returns in traditionally underserved emerging markets. ALTÉRRA is offering a capped return on its CTF commitment, improving the risk-adjusted returns for investors in the Fund and unlocking compelling investment opportunities for private investors. By acting as a catalyst, ALTÉRRA aims to significantly expand private finance and fuel ambitious new climate strategies in both developing and developed markets.
The strategic partnership between Brookfield and ALTÉRRA benefits from Brookfield's global leadership and strong track record as the world's largest transition investor among private fund managers. The first fund in the Brookfield Global Transition Fund series (BGTF I) raised a record $15 billion in 2022. In February 2024, the second fund in the series (BGTF II) announced a first close of $10 billion and is on track to be larger than its predecessor.
For CTF, the capital raised ...