Carlyle Group’s AlpInvest Links Private Equity Fund’s Financing to ESG Performance
Global private equity investor AlpInvest, a subsidiary of private capital investment firm The Carlyle Group, announced that it has secured an ESG-linked credit facility for its private equity co-investment fund AlpInvest Co-Investment Fund VIII (ACF VIII). The facility marks one of the first in the private equity market to tie financing terms to the sustainability aspects of a fund’s operations.
Maaike van der Schoot, Responsible Investment Officer at AlpInvest, said:
“This ESG-linked credit facility, which we believe is one of the first of its kind for a private equity Co-investment fund, is a milestone for AlpInvest. Adding an ESG aspect to the financing structure demonstrates AlpInvest’s commitment to an integrated sustainability approach and to promoting the widespread adoption of responsible investment practices in the private equity industry.”
AlpInvest completed fundraising for ACF VIII in April, raising $3.5 billion. The dedicated co-investment fund seeks to invest alongside top-tier GPs in private equity buyouts and growth capital transactions across industry sectors, globally.
The new credit facility is linked to the operations of ACF VIII with measurable performance indicators that are directly tied to the interest margin of the credit facility, including AlpInvest’s investment process, engagement activity and transparency.
Rob de Jong, Managing Director & Co-Head of Co-Investments, and Richard Dunne, Managing Director and Co-Head of Co-Investments at AlpInvest said:
“AlpInvest has long considered sustainability a key component of our investment processes and core to identifying risks as well as value creation opportunities. The robust KPIs linked to the credit facility provide an effective incentive to build on that approach and represent the natural next step in our long-standing commitment to RI.”