The European Investment Bank is investing up to EUR 30 million in the new private equity fund Dasos Timberland Fund I, targeting timberland investments in Europe and emerging markets. The Luxembourg based fund aims to create a well-diversified global forest portfolio.
The innovative fund will target a commercial return from its investments which are expected to bring major environmental benefits as a result of investment in sustainable forestry projects which are in line with international best-practice guidelines. Moreover, the EIB’s participation in the timberland fund is consistent with its priority objective to promote environmental sustainability by funding projects which preserve natural resources and protect nature and wildlife.
Simon Brooks, EIB Vice President responsible for the Bank’s environmental activities, praised the initiative, saying, “The EIB places great importance on strengthening and diversifying our approach to environmental protection. Investment in the Dasos Timberland fund is somewhat of a trailblazer operation for us at the Bank. It is the first time we have ever invested in a timberland fund and we are confident that it will act as a catalyst for the creation of further opportunities in this area.”
The EIB’s EUR 30 million investment will be used by the Dasos fund managers to finance forestry investments globally, with an emphasis on the 27 EU member states and Croatia, an EU accession country. The projects which the fund will be used to benefit will have a positive impact on three major environmental issues:
- Climate change
- Soil and freshwater conservation
The fund’s core philosophy is to enhance sustainable forest management by investing in forest management programmes which apply international sustainable development principles, including the Pan European Forest Process on Criteria and Indicators for Sustainable Forest Management and the Forest Stewardship Council Principles and Criteria. As such, the fund and its investments will be subject to high environmental, social and sustainability standards.
The Dasos fund achieved its first closing at EUR85m on 9th June and targets a total size of up to EUR 300 million. The fund has an investment period of four years and will be seeking to make its first investments with immediate effect. The fund manager has high-level expertise in the forestry industry and has assembled a strong pipeline of potential projects.