Memorandum of Understanding solidifies IFM’s £10bn commitment to the UK’s energy transition

IFM Investors has signed a Memorandum of Understanding with the UK Government to invest £10bn in the UK’s energy transition by 2027.

The Memorandum of Understanding is between IFM Investors, a global investment manager owned by Australian superannuation funds, and the Department for Business and Trade of the UK Government.

It will be signed at the Global Investment Summit 2023 in London by IFM Investors and the Minister for Investment, Lord Johnson.

The Memorandum of Understanding will help to drive the £10bn investment in the UK across large-scale infrastructure and energy transition projects. The investment will help the government to identify commercially viable opportunities in the energy sector.

Investments from Australian super funds

The news reflects the desire of Australian super funds to invest in the UK market.

Currently, the Australian pension system sits at around £1.8tr and is expected to grow to approximately £4.7tr by 2040. More capital will need to be deployed in aligned economies such as the UK.

The Memorandum of Understanding will allow collaboration between IFM and the UK Government to help build an understanding of policy priorities and the development of energy transition infrastructure.

IFM Investors Chief Executive David Neal, said: “Australia’s ‘super funds’ system can be a trusted long-term partner with the United Kingdom. We’re proud to sign this Memorandum of Understanding with the UK Government, which is a signal of the confidence IFM and Australian super funds have in the UK as a place to invest.”

The Memorandum of Understanding signifies a growing presence in the UK

In 2006, IFM Investors opened an office in London and is continuing to grow its presence in the UK. The global investment manager does this through infrastructure equity and debt, such as IFM’s investment in major UK toll roads, utilities, and airports.

The Memorandum of Understanding will support further UK investment, for example, through Nala Renewables, a portfolio company of one of IFM’s funds and renewable energy businesses in the UK.

The company is seeking investment opportunities in the country as it looks to achieve a renewable capacity target of 4GW by 2025.

The Memorandum of Understanding is an increase of IFM’s commitment in 2022 to invest £3bn in its UK-based infrastructure portfolio assets.

UK Business & Trade Secretary Kemi Badenoch, said: “This £10bn commitment from IFM Investors is a very important investment for the UK’s innovative energy and infrastructure sectors.

“The increasing flows of new capital into our country, combined with the forthcoming Global Investment Summit, show how the UK is fast becoming the most exciting and innovative place in the world to invest.”

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