In brief: Azora invests in carbon procurement business

Spanish asset manager Azora has become the latest firm to venture into the ESG service provider arena, having acquired a stake in carbon procurement company Abatable for $13.5 million according to a press release.

Founded in 2016, Abatable helps companies reduce their emissions through carbon procurement programmes. Azora’s capital will be used to fund the acquisition of carbon credits provider Ecosphere+.

Companies that consult or provide data with the ESG space have received significant interest from private equity managers. Last month, Clearlake and Hellman & Friedman partook in Novata’s $30 million funding round, while the likes of KKR, Brookfield and Blackstone have all invested in the area in recent years.

The investment is the second one made under Azora’s European climate solutions private equity strategy. The first, announced in late 2022, saw the firm acquire a 33 percent stake in Iberian Smart Financial Agro.

Fernando Gómez Fortún, investment director for European climate solutions at Azora, told New Private Markets that the strategy will see the firm invest in innovative lower mid-market businesses across three themes: decarbonising urban city centres, new energy solutions and sustainable agriculture. Investments will be between $10 million and $40 million. He declined to comment on the fund’s target size or fundraising status.

Fortún explained that part of Abatable’s appeal was the benefit it could offer Azora’s wider portfolio. “We have the ability to identify investment opportunities that potentially could be service providers to our real assets,” he said.