Mandiri IM partners Armstrong for cleantech PE

Mandiri Investment Management will invest in Indonesia’s clean energy sector through a co-investment partnership with Armstrong Asset Management, a cleantech PE firm based in Singapore.

Mandiri IM, a newly formed unit of Bank Mandiri, has agreed to make co-investments in renewable energy projects in Indonesia with Armstrong. Hydropower facilities will be a focus, particularly mini hydro-electric power plants.

Mandiri IM was set up last month in Singapore to facilitate investments in Indonesia by Singaporeans, with a target of having more than $100 million in AUM in its first year of operation.

It is a subsidiary of Jakarta-based Mandiri Investasi – Indonesia’s biggest homegrown fund manager with about $2 billion in assets, also part of Bank Mandiri, Indonesia’s biggest lender.

Armstrong, which closed its South East Asia Clean Energy Fund at $164 million in November, is examining cleantech deal opportunities in Indonesia, says the firm’s co-founder, Michael McNeill.

“[It] includes a number of mini-hydro projects which are at various stages” of development, he tells AsianInvestor. “We have been talking to a number of parties.”

To date, Armstrong has invested in Annex Power for the development of clean energy projects in Indonesia, the Philippines and Thailand, and Symbior Elements, which holds development and operating rights for projects in Thailand.

Armstrong hopes to leverage the deal-origination strengths and counterparty risk assessment capabilities of Mandiri Investment’s banking parent for investments in Indonesia, says McNeill.  

Bank Mandiri is no stranger to cleantech, having received two lines of credit, each worth $100 million, over the past four years for clean energy projects by Agence Française de Développement (AFD), a development agency of the French government.

Its latest credit line, granted in November, is intended to finance about a dozen clean and renewable energy projects in Indonesia.

While Mandiri IM has a clean energy mandate, it has not yet been confirmed as to whether Bank Mandiri’s credit line from AFD will be used for its co-investment activities with Armstrong.