The Delta fund will invest in mid-sized private companies that are expected to generate strong long-term returns as well as contribute to at least one of UN’s Sustainable Development Goals (SDGs).
In a statement on Monday, Rest clarified that the Delta fund will specifically target opportunities in North America and western Europe in sectors such as green industry and clean energy, education and human capital development.
Rest chief investment officer Andrew Lill said the deal aims to give the $85 billion fund greater exposure to assets that are expected to benefit from three key themes: digitalisation, decarbonisation, and demographic changes.
“The TowerBrook Delta fund will look to invest in sectors of the economy at the forefront of the megatrend shifts now and into the future, such as education and human capital development, food and agriculture, healthcare and water, and the environment and clean energy,” Lill said.
“We believe these megatrends will present investment opportunities for our 2 million members, many of whom are decades from retirement. The Delta fund will aim to identify innovative private companies that we believe will represent strong examples of these opportunities.”
Additionally, Rest is making a co-investment with TowerBrook in LiftWerx, a Canadian firm that specialises in servicing wind turbines with its “up-tower” crane technology.
“Our co-investment in LiftWerx is also an example of a company we expect to benefit from decarbonisation, through its innovative, cost-effective solution to maintaining wind turbines,” Lill said.
According to the fund, this commitment also moves it closer to its target of a 1 per cent allocation to impact investments across Rest’s total portfolio by 2026.
Gordon Holmes, chief investment officer at TowerBrook, said: “We are delighted to have Rest investing in our Delta fund and as a co-investor in LiftWerx”.
“The Delta fund gives us the opportunity to partner with younger, innovative companies that are committed to commercial success while making a positive and lasting contribution to society or the planet,” Holmes said.
The deal marks Rest’s second private equity impact investment, following a commitment to specialist private equity firm ARCHIMED.
Other impact investments in the portfolio include a listed equities mandate with Ninety One and commitments to the LOGICs industrial property fund, the agriculture-focused Cibus II Fund, and the unlisted infrastructure Palisade Impact Fund.
