Insurance company Aflac’s asset management arm Aflac Global Investments announced today a partnership with global energy, resources and sustainable infrastructure investor Denham Capital, committing over $2 billion to sustainable infrastructure investments. The agreement marks a significant increase in assets allocated to ESG-focused strategies for Aflac, and provides a substantial boost to the Denham Sustainable Infrastructure platform.
Stu Porter, founder, Managing Partner, CEO and CIO of Denham Capital, said:
“Global demand for assets which fulfill Environmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. More objectives has significantly bolstered the need for investing in sustainable infrastructure, and as such, we expect energy transition initiatives and investment into sustainable infrastructure to increase materially well into the future. Our expanded Sustainable Infrastructure strategy will focus on markets where we see the biggest growth opportunity, and we believe we can make the biggest positive impact. Denham looks forward to partnering with Aflac as we seek to address climate change with capital, infrastructure and technology.”
Under the new agreement, Aflac will commit $2 billion to launch a new debt platform with Denham Sustainable Infrastructure. The platform will target investment-grade and below-investment-grade sustainable infrastructure investments, with an initial focus on developed markets, including North and South America, Asia, Europe and Australia.
Additionally, Aflac will allocate $100 million toward Denham’s second dedicated equity fund. The new fund aims to acquire, enhance and develop sustainable infrastructure assets, targeting mid-market companies, with the majority of investments expected to be in renewable power and energy storage across developed and developing markets.
Aflac Global Investments will also hold a non-controlling 24.9% minority equity interest in Denham Sustainable Infrastructure.
Eric M. Kirsch, Aflac Incorporated Executive Vice President, Global Chief Investment Officer and President of Aflac Global Investments, said:
“Part of Aflac Global Investments’ long-term growth strategy is to identify and partner with successful third-party managers like Denham, which has a track record and is a leading asset manager of infrastructure assets. The nature of these asset classes will enable us to capture higher yields while providing enhanced credit protection, adding value to our portfolio and to our stakeholders, while advancing our Environmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. More priorities. In addition, our equity stake enables Aflac to participate in the expected growth of an attractive asset management partner in a growing asset class while broadening our sustainability exposure and commitments.”
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