Ludgate Investments Ltd., a London-based private equity investor, is seeking to raise as much as $300 million to finance waste-recycling and water-treatment businesses through a second resource-efficiency fund.
“The value proposition is resource scarcity and the fact that wastes have now become commodities, providing strong returns,” Chief Executive Officer Gijs Voskamp said in an interview in London. “There is no other way than becoming more efficient with resources.”
Private equity investors are looking to benefit from the conflicting challenges of rising demand for resources and environmental protection. The world’s 7 billion people need to secure more water, more energy and more food, while curtailing the effect of greater consumption on their surroundings.
Ludgate plans to raise $200 million to $300 million tapping new and existing investors, Voskamp said. The company is studying a German water-management business and will look at biogas power generation and plastics recycling among its planned investments in the U.K. and elsewhere in Europe.
The company’s first Ludgate Environmental Fund listed on London’s Alternative Investment Market in 2007 and raised more than $100 million. The fund is more than 90 percent invested in companies including Rapid Action Packaging Ltd., whose clients include McDonald’s Corp. and Starbucks Corp., and Tamar Energy Ltd., which produces energy from organic waste matter.
“The fund has so far returned some 43 percent of the money invested back to the fund,” Voskamp said. “This is an industry that makes money.”