Infrastructure fund in Malaysia, overseen by CFM and Argos Partners, adheres to Shariah principles
Malaysia Climate Infrastructure Fund (MCIF) Launched with €100m Initial Investment
The Malaysia Climate Infrastructure Fund (MCIF), a shariah-compliant private equity infrastructure fund, has been launched with a target size of $500 million (€429 million). The fund aims to invest in climate-related infrastructure projects across Malaysia, Asia, and Latin America.
Malaysia’s largest public sector pension fund, KWAP, has made an initial investment of €100 million in the MCIF. The fund will be co-managed by Climate Fund Managers (CFM) and Argos Partners, domiciled in Malaysia.
The MCIF's investment focus includes infrastructure sectors such as renewable energy, transportation, digital infrastructure, water, and wastewater. Equity investments will typically range between $15 million to $30 million, tailored by project size, sector, and stage.
The MCIF aligns with Malaysia's broader Dana Pemacu initiative, launched by KWAP in May 2024. This initiative aims to mobilize RM6 billion (~$1.4 billion) in investment to strengthen Malaysia’s private market ecosystem using both conventional and shariah-compliant funds. The Dana Pemacu programme targets three main asset classes - private equity, infrastructure, and real estate, investing in sectors like food security, education, the silver economy, healthcare, energy transition, digital economy, and financial inclusion.
By co-managing the fund under a co-GP model, the Dana Pemacu programme seeks to enhance domestic investment capacity, accelerate funding in critical sectors, and drive sustainable economic, environmental, and social growth. At least 40% of the MCIF's capital will be allocated to Malaysian opportunities.
The MCIF's shariah-compliant status is intended to broaden its appeal by opening access to a broader pool of investors, particularly those with mandates or preferences for Islamic finance. The fund's typical investment range is between $15m-$30m per project.
The Dana Pemacu initiative has selected CFM as one of 12 shortlisted general partners to manage funds. The MCIF's fundraising efforts aim to appeal to both conventional and values-based investors, including pension funds, insurance companies, asset managers, and family offices. The MCIF aims to raise a total of $500m from other institutional investors.
With the launch of the MCIF, Malaysia continues to demonstrate its commitment to sustainable growth and private sector development, focusing on infrastructure projects that address climate change and contribute to the country's long-term economic development.
[1] The Edge Markets. (2024, May 1). KWAP to invest €100m in shariah-compliant infrastructure fund. Retrieved from https://www.theedgemarkets.com/article/kwap-to-invest-e100m-in-shariah-compliant-infrastructure-fund
[2] New Straits Times. (2024, May 1). KWAP invests €100m in shariah-compliant infrastructure fund. Retrieved from https://www.nst.com.my/business/2024/05/748832/kwap-invests-e100m-shariah-compliant-infrastructure-fund
[3] Bernama. (2024, May 1). KWAP invests €100m in shariah-compliant infrastructure fund. Retrieved from https://www.bernama.com/en/business/news.php?id=1988428
[4] The Star. (2024, May 1). KWAP invests €100m in shariah-compliant infrastructure fund. Retrieved from https://www.thestar.com.my/business/business-news/2024/05/01/kwap-invests-e100m-in-shariah-compliant-infrastructure-fund
- The Malaysia Climate Infrastructure Fund (MCIF), with a target size of $500 million, has been launched, focusing on climate-related infrastructure projects across various regions, including Malaysia, Asia, and Latin America.
- Malaysia’s largest public sector pension fund, KWAP, made an initial investment of €100 million in the MCIF, which will be co-managed by Climate Fund Managers (CFM) and Argos Partners in Malaysia.
- The MCIF's investment focus includes sectors such as renewable energy, transportation, digital infrastructure, water, and wastewater, with equity investments typically ranging between $15 million to $30 million.
- The MCIF aligns with Malaysia’s broader Dana Pemacu initiative, targeting asset classes like private equity, infrastructure, and real estate, and investing in sectors like food security, education, the silver economy, healthcare, energy transition, digital economy, and financial inclusion.
- By co-managing the fund under a co-GP model, the Dana Pemacu programme seeks to enhance domestic investment capacity, accelerate funding in critical sectors, and drive sustainable economic, environmental, and social growth, with at least 40% of the MCIF's capital allocated to Malaysian opportunities.
- With the MCIF's shariah-compliant status, the fund aims to broaden its appeal to investors with mandates or preferences for Islamic finance, including pension funds, insurance companies, asset managers, and family offices, while continuing to focus on business opportunities in industries like energy transition and finance, ultimately contributing to Malaysia's long-term economic development.
