Morgan Stanley Investment Management held the first close for its 1GT climate private equity strategy totaling $500 million in commitments.
1GT is set to invest in growth-stage companies that will seek to collectively avoid or remove one gigaton of carbon dioxide-equivalent emissions from the Earth’s atmosphere from the date of investment through 2050 — the date of the U.N.’s Net Zero mandate. The Article 9 fund sits within the firm’s $200 billion alternative investments business.
“Reaching our halfway goal is an important milestone,” said Vikram Raju, Morgan Stanley Investment Management’s head of Climate Private Equity Investing, on the first close. “Our anchor investors have demonstrated a strong level of climate ambition by backing 1GT with its twin goals of investing in compelling high-growth companies in Europe and North America while aiming to deliver transformational climate impact at the gigaton level. Tying the team’s incentive compensation to both of the 1GT goals recognizes this in equal measure. We have begun executing on our pipeline at a very opportune phase in the growth equity market.”
The private companies the team will invest in span transportation, energy, sustainable food and agriculture and circular economy themes.
Morgan Stanley recently co-led a $50 million funding round for Everstream Analytics to accelerate global supply chain sustainability.
“We are extremely pleased by the strong investor support for 1GT,” said David Miller, head of Morgan Stanley Private Credit and Equity. “This strategy provides our clients an innovative solution that seeks to address time-critical climate issues and brings Morgan Stanley’s considerable resources to portfolio companies to help accelerate climate impact and earnings growth to create more exit optionality.”