Eurazeo targets €1bn for new Planetary Boundaries climate impact fund

Eurazeo’s Planetary Boundaries is expected to become its largest climate fund to date, outstripping the firm’s venture and infrastructure climate strategies.

Eurazeo has launched a climate impact fund with a €1 billion target, New Private Markets has learned.

The fund, known as Planetary Boundaries, is a private equity strategy addressing climate and environmental themes including decarbonisation, circular economy, biodiversity protection and energy efficiency. Eurazeo declined to comment.

This is not Eurazeo’s first climate fund, but it will be the French firm’s largest to date if it reaches its target. Eurazeo closed Smart City Fund II, a venture strategy focused on low-carbon and emissions mitigation solutions for urban areas, on €400 million last year.

The firm is also marketing two infrastructure funds: the Eurazeo Transition Infrastructure Fund, an Article 9 fund launched in April 2022, “should soon exceed its target of €500 million”, the firm said in December 2023; while the Eurazeo Sustainable Maritime Infrastructure Fund, launched in 2021, has a €350 million target.

Eurazeo has long been a torchbearer for sustainability in private equity. It set a 2040 net zero target in 2020 and was among the first private equity firms to have its net zero target validated by the Science-Based Targets Initiative. It obtained a €1.5 billion credit facility linked to ESG performance in 2020 – the first private equity ESG-linked credit line in Europe.

The firm has also set a target for women to comprise 40 percent of portfolio company executive teams by 2030, and has pledged to roll out value-sharing mechanisms to benefit 75 percent of portfolio company employees by 2040.

But beyond sustainability matters, the Paris-listed firm has had a turbulent past 12 months. Former chief executive Virginie Morgon, who had served five years at the firm’s helm, was ousted by shareholders from the role last February following a years-long share price flatlining and fundraising taking longer than expected for Eurazeo’s fifth flagship fund, affiliate publication Private Equity International reported at the time (registration required). Mid-large buyouts head Marc Frappier also left in April last year. Co-chief executives Christophe Bavière and William Kadouch-Chassaing replaced Morgon.