Morgan Stanley Investment Management (MSIM) announced today that it has held the final close of the 1GT climate private equity fund (1GT) at $750 million of equity capital commitments. 1GT targets growth-oriented investments in companies in North America and Europe aiming to collectively avoid or remove one gigaton of carbon dioxide-equivalent (CO2e) emissions from the Earth’s atmosphere from the date of investment through 2050. The investor group was led by a number of institutions in Europe, Japan and North America.
Commenting on the close, Vikram Raju, MSIM’s Head of Climate Private Equity Investing and 1GT, said: “We are pleased to have arrived at the final close of 1GT, a highly focused fund that is providing capital at the critical growth stage to companies whose products and services enable meaningful reduction in the global carbon footprint. 1GT’s investors saw the unique opportunity to invest in a fund with a tangible, transparent, and independently measured climate goal, which directly ties to the team’s incentive compensation.”
Half of the 1GT team’s financial incentives will be tied to achieving the avoidance or removal of one gigaton of CO2e emissions by 2050.
“1GT's close represents the best of Morgan Stanley's thinking around delivering fiduciary returns to our clients while providing transparent, transformational climate impact,” said David N. Miller, Head of Morgan Stanley Private Credit and Equity. “We are also able to deliver to our growth stage investees the insight, expertise and access that come from being a leading global financial services firm.”
Part of MSIM’s $240 billion alternative investment business, 1GT targets investments in private companies across mobility, power, sustainable food, agriculture and the circular economy. 1GT is an Article 9 fund under the Sustainable Finance Disclosure Regulation, which promotes environmental or social characteristics and integrates sustainability into the investment process in a binding manner.
The 1GT team will leverage Morgan Stanley’s considerable resources to partner with portfolio companies to pursue earnings growth, multiple expansion and enhanced exit potential, while helping to increase climate change mitigation and improve ESG monitoring and reporting. Examples of 1GT’s investments to date include high-performance portable battery provider Instagrid, sustainable nutrition brand Huel, and sustainable supply chain services company Everstream Analytics.
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