NEST is investing £200m (€231m) in infrastructure credit across developed markets through its partnership with IFM Investors.
The UK workplace pension scheme will invest in the financing of “next-generation climate technologies” in developed markets globally, including a “strong UK pipeline”.
IFM will target companies and asset-backed debt across power and energy, sustainable transportation, digital circular economy and industrial innovation sectors.
The latest commitment follows the five-year plan announced by NEST last year to deploy £5bn into private markets.
The strategy builds on earlier investment by the £53bn pension scheme, which included taking a 10% stake in IFM’s holding company, Industry Super Holdings, and providing €530m in seed capital to a European infrastructure debt fund managed by IFM Investors.
Rachel Farrell, director of public and private markets at NEST, said: “This investment represents a compelling opportunity to generate returns for our members by tapping into some of the most exciting and innovative climate technologies in the world, including those right here in the UK.
“It is made possible through our strategic partnership with IFM, which enables us to seed new strategies like this and help unlock wider capital flows from other investors. We’re here to support entrepreneurs in accessing the capital they need to scale their ideas into real-world solutions.”
Rich Randall, global head of debt investments at IFM, said the mandate expands IFM’s focus to innovative infrastructure and industrial technologies that support economic resilience, energy security and supply chain strength.
Randall added: “As a pension fund owned institution, IFM is focused on delivering strong long-term outcomes for working people’s retirement savings through investments with resilience, durability and lasting value.
“Through this partnership, we aim to provide flexible growth capital to high quality businesses helping drive the transformation of critical infrastructure systems, while delivering attractive risk adjusted returns for investors.”
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