Algebris plans VC strategy as PE transition fund passes €300m

Italian asset manager Algebris Investments is planning to launch a clean tech venture capital fund “in the next quarter” of this year, New Private Markets has learnt.

Algebris is a well-established name in the public markets, with €22 billion of assets under management. However, the firm had not engaged with private markets until it launched a PE Green Transition Fund in 2021 to invest in sustainable businesses in the energy transition, circular economy, smart cities and agritech sectors. LPs in that fund include Fondo Italian di Investimento, according to the New Private Markets database, and the European Investment Fund, per its 2022 annual report.

It is understood that the new platform will target the same sectors as the Green Transition Fund, with the intention that the two funds will collectively allow Algebris to invest in companies at all stages of development. The firm is set to recruit a team of specialists to lead the strategy, according to a market source. Algebris declined to comment.

The planned strategy looks set to come to fruition just as the firm rounds up fundraising for the Green Transition Fund. The firm announced a first close on €260 million in July 2023, but has now secured further commitments taking the total figure to €330 million, managing director Valerio Camerano told New Private Markets.

“We’re actually heading to the point we wanted to reach, which was €350 million, or something between €300 million and €400 million,” Camerano said, adding that a final close is expected this July. Its third investment, Esapro, which provides services for solar photovoltaic systems operating mainly in Italy and Romania, was announced earlier this month.

Of the decision to move into private markets, Camerano said: “Our founder Davide Serra felt the green transformation of the economy was fundamental trend on which Algebris should have focused its attention. His idea was that to have success in this sector, you need to combine financial experience and industrial competence. We brought in my team, which has a personal history of managing industrial assets.”

Prior to joining the firm, Camerano spent six years as CEO of A2A, an Italian utility company providing renewable energy, electricity, gas, water and waste management services.

Algebris’s sustainable products are not limited to private equity: the firm also has two liquid funds, one on the bonds market and another on the equity market, with a green transition focus. Camerano said that, as a private equity fund, “GTF can provide long-term, locked-in capital, as well as managerial support and M&A activities, which can support SMEs especially through this transformational journey”.