Impact Fund Denmark has closed SDG Fund II at its full size of DKK 5 billion. The fund invests in companies across 13 developing and emerging markets, combining sustainable development with attractive returns for private investors.
The fund has been closed with a group of private investors comprising five pension funds, P+, PenSam, PKA, PFA and PBU, as well as Jyske Bank, alongside public capital from Impact Fund Denmark.
SDG Fund II is structured as a blended finance model, where private investors in the fund receive priority returns of up to 6%. In return, they give up part of the upside once returns exceed 12%. This makes it possible to combine competitive returns with measurable development impact in growth markets.
The fund invests, among other things, in companies that are not yet listed, as a large share of growth in developing economies takes place outside public equity markets. Impact Fund Denmark has also secured an EU guarantee under EFSD+, which reduces risk for private investors by covering potential losses on individual investments.
Lars Bo Bertram, CEO of Impact Fund Denmark, commented, "Both five pension funds and now also Jyske Bank investing in the fund shows that an increasing number of private investors see the potential in combining returns with sustainable development. For us, this demonstrates that public funding can be used to mobilise private capital at scale. SDG Fund II stands as a strong example of that."
More than DKK 1 billion of the total DKK 5 billion has already been invested in five companies.
Radiance Renewables, a key player in India’s green transition, will use the investment to build an additional 926 MW of solar capacity.
Sturdee Energy develops renewable energy projects in Southern Africa and is expected to reduce CO₂ emissions by half a million tonnes annually.
Imperium Holding, a Moroccan company and leader in tea packaging, is expected to create more than 840 new jobs, 95% of which will be filled by women.
Project Villeta in Paraguay produces green fertiliser using hydropower-generated electricity, replacing imports of carbon-intensive fertiliser from Russia and the Middle East.
Spiro, one of the largest e-mobility companies in Africa, is expanding the number of electric motorcycles and battery swap stations, reducing costs for local drivers and cutting emissions.
The remaining approximately DKK 4 billion will be invested by 2028, with an expected return of 12% to 15%.
An EU EFSD+ guarantee of more than EUR 71 million has been secured for SDG Fund II. Investments are, among other things, enabled by financing made available under the EU’s Global Gateway strategy.