Private Equity funds

Private Equity Investments in Renewable Energy

Private Equity Funds in Renewable Energy

Introduction

There are two main purpose of this paper. The first purpose is to discuss a private equity company involved in making investments in renewable energy sector. And the second aim of this paper is to discuss the investment of other private equity houses on renewable energy sector. We will discuss this issue in accordance with Daniel Schafer's article 'Winds of Change'. The company selected to fulfill the purpose of this paper is HgCapital. HgCapital is a private equity firm who is engaged in buying out of small, medium and large size companies all over Europe.

The firm makes investment in all sorts of industries but it has a specialized fund for renewable energy. It invests in five sectors: Industrials, Health care, TMT, Services and Renewable energy. The company was established in 1985 by the name of Mercury Private Equity. It is headquartered in London, United Kingdom. HgCapital has total assets of around $5.2 Billion. It has 80 Employees in its offices in Germany and United Kingdom.

Discussion

HgCapital was the first UK Private Equity fund that involved in investing in renewable energy sector. Today HgCapital is considered to be the largest renewable energy fund player in Europe in terms of the amount of capital it raised. It established its first renewable energy investment team in 2004 and made its first investment in 2006 after a thorough research of the sector. The Team initially invested in utility renewable project in Western Europe through technologies such as solar, hydro, and onshore wind. For that purpose the company uses 'fund investment approach for infrastructures'. The company focuses on small hydro and wind projects which are independent of government support. In Scandinavia, the company has become the major owner and player of onshore wind farms. ...