Boston and Montreal-based Spring Lane Capital, a private equity firm, has raised about $151 million for its second fund. The target is $400 million. The fund will back entrepreneurs and project developers in the sustainable infrastructure sectors including food & ag, energy, water, waste and transportation.
BOSTON & MONTREAL, Nov. 16, 2021 (GLOBE NEWSWIRE) — Spring Lane Capital, a private equity firm focused on providing catalytic project capital for sustainability solutions in the energy, food, water, waste and transportation industries, announced today a first close of approximately $151 million for its second private fund. Spring Lane Capital is targeting $400 million in total capital for its second fund. The fund will seek to back entrepreneurs and project developers in the sustainable infrastructure sectors including food & ag, energy, water, waste and transportation. These equity commitments double Spring Lane Capital’s current AUM and will allow the firm to expand its team and geographical footprint.
Spring Lane Capital’s inaugural private fund raised $157 million in commitments and completed fundraising in November 2019. The inaugural fund has committed a substantial majority of its capital only two years following its final close. In addition to the four investments already publicly announced (Atlas Organics Inc; Aries Clean Energy; Cambrian Innovation and 7 Generation Capital), the firm is announcing two additional investments in the food & ag and renewable natural gas sectors. The deals mark Spring Lane Capital’s first investments in these sectors. A seventh investment is expected to be announced by end of this year. The two new deals include:
Vandalia Growers USA LLC, a Buffalo, West Virginia-based indoor farming platform that will grow specialty tomatoes in controlled environment greenhouses. The equity investment of $13.5M from Spring Lane Capital and another investor in Vandalia Growers supports the first phase of the project in the construction and operation of a 10 acre greenhouse, currently underway. An anticipated second phase is expected to commence following the completion of the first facility (phase one) which is expected to complete construction early next year; and
The launch of a renewable fuels development platform that will convert animal waste into renewable natural gas to be used as an alternative transportation fuel in California. The investment combined development capital with project equity financing to support the platform throughout the project’s lifecycle. The projects will create local jobs at its eventual sites, generating additional income for farmers, improving air quality and displacing fossil fuels. Spring Lane will be releasing more details on this platform as it gets closer to commercial launch.
“We believe the sustainability market for private equity has never been stronger, and that there’s significant interest from a wide array of institutional investors including pension funds and banks in project capital that can catalyze sustainable infrastructure,” said Rob Day, Partner and Co-Founder of Spring Lane Capital. “In our opinion, investors are eager to find sustainable solutions to our biggest infrastructure and climate challenges that are designed to offer an attractive risk / reward profile. We continue to see what we believe is a substantial shift in capital allocation with divestments from fossil fuels to more sustainable investments across the broader financial markets. This trend continues to boost enthusiasm around our second private fund.”
“Many of the LPs that participated in our inaugural private fund are reupping and even increasing their commitments for the second fund which reflects the efficacy of our unique investment strategy. We now have doubled our assets under management which is allowing us to expand our team and our geographical footprint so we can broaden and increase our already robust pipeline of investments,” said Christian Zabbal, Managing Partner and Co-Founder of Spring Lane Capital. “We believe the market is full of possibility, and we are pleased to enter the food and ag and renewable natural gas sectors with two important deals. Along with the other investments we have made from our first fund, and the strong entrepreneurial activity in the sustainability sector in general right now, our belief is our second fund is coinciding with a period of exciting action around climate and sustainability solutions.”
The Investment Management Group of WilmerHale, a leading, full-service international law firm, served as legal counsel to the fund close announced today by Spring Lane Capital. For more information on the firm, please visit http://www.wilmerhale.com.
About Spring Lane Capital:
Spring Lane Capital is a private equity firm based in Boston, MA and Montreal, QC focused on providing catalytic project capital for sustainability solutions in the energy, food, water, waste and transportation industries. The firm’s structured financial model seeks to tap into some of the fastest growing segments of these markets, that more traditional forms of project capital cannot access due to their scale and the limitations of existing investment models. For more information, please visit springlanecapital.com.