Incofin launches water fund

Incofin has announced the launch of its Water Access Acceleration Fund (W2AF), a private equity vehicle focusing on safe drinking water, with €36 million of commitments. The blended fund aims to provide 20 billion litres of water to 30 million people, mainly in Africa and Asia. W2AF invests in innovative water businesses that provide affordable, safe drinking water to underserved populations.

The committed capital comes from a diverse pool of private and public investors, including Danone along with BNP Paribas, the U.S. International Development Finance Corporation (DFC), Norfund, the Danish development finance institution IFU, and international foundation Aqua for All. The U.S. Agency for International Development (USAID) provided catalytic funding to enable a first-loss tranche.

W2AF is the first private equity initiative in a sector that is traditionally financed by governments, donors and foundations. The fund aims to demonstrate the financial viability of the safe drinking water market worldwide. It has a blended finance structure – an approach to use part of the public and private donor funds to attract capital from private investors. W2AF hit €36 million in commitments at this first closing and aims to achieve total capital commitments of €70 million in subsequent closings.

“Drinkable water is a luxury we too often take for granted. Yet, 2.2 billion people today do not have access to safely managed drinking water. Meanwhile, there are talented water company owners who know how to solve this problem but can’t find an investor who aligns with their vision to help them scale up. That’s why Incofin created the W2AF, to address the growth capital needs of these entrepreneurs, and to prove that the drinking water sector is investment-ready, even when targeting low-income people,” said Dina Pons, managing partner at Incofin and W2AF fund relationship manager.