Banco Santander, through its asset-management arm Santander Alternative Investments, has launched a fundraising process to raise a new venture capital fund focused on renewable energy investments in Spain and Portugal. The vehicle aims to attract up to one hundred million euros from a range of investors in the coming weeks. In the prospectus approved by the National Securities Market Commission (CNMV) last Friday, the fund will invest in companies that develop activity in electricity generation using renewable technology, including solar photovoltaic and wind power, as well as storage systems or batteries linked to those assets.
The vehicle is planned to have an eight-year lifespan after closing and capital is raised, with a possible two-year extension at the discretion of the management division led by Luis García-Izquierdo. From year ten onward, extensions would require participant authorization. Caceis Bank Spain (Crédit Agricole) will act as the depository bank, and PwC will serve as the auditor.
The fund will invest in non-listed companies whose primary activity is renewable electricity generation or storage systems, though it may maintain liquidity intended for future investments or short-term needs. Liquidity is not expected to exceed 15% of the fund’s value. The focus will be the Iberian Peninsula, but investments may be made in other Eurozone countries as long as they do not exceed 30% of the portfolio, and leverage will be allowed up to 60% of asset value.
Only professional investors will be eligible to participate in this fund, with a minimum commitment of €100,000. Management fees range from 1.25% to 2%, depending on the share class, and subscription fees run from 0% for commitments above €5 million to 1.5%, with an performance fee to be determined by the investment outcome.
Santander AI Funds
This is the fifth vehicle launched by Santander Asset Management’s alternative investments arm in the last two years and the third focused on renewable energy, according to the CNMV’s history. The alternative investments division manages 22 investment vehicles and 2.5 billion euros in assets as of December 2023, spanning four strategies: infrastructure and energy, real estate, private debt, and fund-of-funds.
In February 2022, Santander Iberian Renewable Energy was raised with 200 million euros for investments in photovoltaic and wind power. In October 2022, Santander Innoenergy Climate followed, a 125-million-euro vehicle aimed at startups tied to energy transition topics, including renewables, storage, smart grids, technology for cities and sustainable buildings, energy efficiency, energy for transport, mobility, and circular economy concepts.
Other sanctioned funds by Santander AI include Santander Global Real Estate Assets, a fund of funds launched in November 2022 that allocates between 200 and 300 million euros to other funds managed by players like KKR and Blackstone, focusing on real estate and infrastructure in the United States and Europe, including telecoms, energy, transport, and waste treatment. Santander Secondaries 2023, with a 100-million-euro target, seeks positions in other private equity real assets through secondary investments or coinvestment opportunities.