Temasek Holdings and BlackRock Form Decarbonization Partners
Posted on 04/13/2021
Singapore’s Temasek Holdings and BlackRock, Inc. agreed to establish a partnership called Decarbonization Partners. The partnership will launch a series of late stage venture capital and early growth private equity investment funds that will focus on advancing decarbonization solutions to accelerate global efforts to achieve a net zero economy by 2050.
BlackRock and Temasek intend to commit a combined US$ 600 million in initial capital to invest in multiple funds launched by the partnership. The funds will also raise third-party capital from investors who are committed to achieving a net zero world while also seeking to obtain long-term sustainable financial returns. Decarbonization Partners has a fundraising target of US$ 1 billion for its first fund, including capital from Temasek and BlackRock.
Temasek and BlackRock want to identify companies in private markets that have proven technologies that will reduce and potentially eliminate carbon emissions. The Decarbonization Partners funds will deploy private capital with a focus on early stage growth companies targeting proven, next-generation renewable and mobility technology including emerging fuel sources, grid solutions, battery storage, and electric and autonomous vehicle technologies as well as in building and manufacturing sectors to drive decarbonization, resource efficiencies, and material and process innovation. There could also be a move toward making hydrogen as a replacement for oil and gas.
The partnership will leverage both firms’ expertise in sourcing and underwriting private investments, portfolio and risk management, and sustainable technology and analytics. The funds will be staffed by employees from both firms, as well as a professional and dedicated team recruited to source and undertake investments and manage its portfolio. Decarbonization Partners plans to run like a traditional venture capital/growth equity fund.