The European Investment Bank and five state-owned lenders said today they had set up a fund worth €600 million to invest in European energy and transport networks and renewable energy.
The so-called Marguerite fund, part of the European Union's efforts to fight the economic crisis, will be chaired by EIB President Philippe Maystadt, the banks said in a statement.
The EIB, financing arm of the EU, France's Caisse de Depots et Consignations, Italy's Cassa Depositi e Prestiti, Germany's KfW, Spain's Instituto de Credito Oficial and Poland's PKO BP each committed €100 million to the fund yesterday.
The group expects private investors to join the fund, raising its capital to €1.5 billion in 2011.
"The fund should serve as a model for the establishment of other similar funds in the EU wishing to combine a market-based principle of return to investors with the pursuit of public policy objectives," the statement said.
"It will provide equity or quasi equity to companies which own or operate infrastructure in the sectors of transport and energy 'Trans-European Networks', as well as renewable energy," it said.
The statement said the fund would allocate its capital within four years and invest over 20 years, focusing on greenfield projects - those on undeveloped land.
"The investors in the fund and other long-term credit institutions intend to establish a debt co-financing initiative of up to €5 billion, providing a source of long-term debt for the projects that Marguerite invests in," it said.
Reuters