Commercial, Finance, Sourcing Renewables  -  May 17, 2023

Morgan Stanley Raises $500 Million for 1GT Climate Private Equity Strategy

Morgan Stanley Investment Management (MSIM) announced that it completed a first close for the 1GT climate private equity strategy (1GT) at $500 million of equity capital commitments. 

Public and private pension funds and an insurance company in the Nordic region, Germany and the UK were among the investors. 

1GT is focused on investing in growth-stage companies that will seek to collectively avoid or remove one gigaton of carbon dioxide-equivalent (CO2e) emissions from the atmosphere from the date of investment through 2050, the date by which the United Nations has mandated “Net Zero” must be achieved.

“Reaching our halfway goal is an important milestone,” said Vikram Raju, MSIM’s Head of Climate Private Equity Investing and 1GT, in a statement. “Our anchor investors have demonstrated a strong level of climate ambition by backing 1GT with its twin goals of investing in compelling high-growth companies in Europe and North America while aiming to deliver transformational climate impact at the gigaton level. Tying the team’s incentive compensation to both of the 1GT goals recognizes this in equal measure. We have begun executing on our pipeline at a very opportune phase in the growth equity market.”

1GT is part of MSIM’s $200 billion alternative investments business and targets investments in private companies across the mobility, power, sustainable food and agriculture, and circular economy themes. Under the Sustainable Finance Disclosure Regulation, 1GT is an Article 9 fund, which promotes environmental or social characteristics and integrates sustainability into the investment process in a binding manner. The team recently co-led a $50 million funding round for Everstream Analytics to accelerate global supply chain sustainability and aim to reduce emissions for global brands.