Origo Partners, an AIM-listed private equity firm focused in China-linked core economic growth opportunities, has signed a memorandum of understanding with Chinese authorities for the formation of a yuan-denominated fund that will invest in the cleantech sector.
The Origo China Sustainable Development Fund hopes to raise $75m and has agreed upon an anchor investment of $18m from the Xinxiang municipal government.
The fund has its eye on renewable energy, electric vehicles, waste recycling, energy storage and distribution, sustainable agriculture and water-related technologies.
The local government backing is part of a push to address dependency on foreign energy sources, declining fresh water resources, contaminated food supply and growing environmental pollution, Origo said.
With more than 200 registered battery manufacturers alone, Xinxiang city is particularly known for its electric vehicle, energy storage and automotive industries. Origo hopes to tap into this and exit investments through domestic stock markets.
Chris Rynning, CEO of Origo, said, “The launch of our first RMB fund will be the start of a new series of funds for Origo in the domestic Chinese market. We are delighted to be able to work with the Chinese government in accessing the best and fastest growing Chinese clean technology companies.”
Origo recently opened a new office in the Mongolian capital of Ulan Bator and created a new fund, Origo Altai Partners, to invest in the country.
As well as Chinese cleantech, the firm will put money to work in Mongolia’s minerals sector. The Asian country is rich in gold, iron ore, molybdenum, uranium, oil, copper and coal and exploration licenses cover a third of the country’s 1.5 million km2 land mass.