The Water Access Acceleration Fund attracted commitments from international development finance institutions, foundations, family offices, and private investors.
Belgian impact fund manager Incofin Investment Management said its Water Access Acceleration Fund (W2AF), which aims to provide underserved communities in Africa and Asia with affordable and safe drinking water, has reached a final close with commitments of €61m.
As previously reported by Impact Investor, the fund, a private equity fund and blended finance initiative, had been targeting total capital commitments of €70m when it first launched in 2023.
Danone Communities, the venture capital fund of French food and beverage multinational Danone, acted as the lead anchor investor. Other backers of the fund include the US International Development Finance Corporation (DFC), the European Investment Bank (EIB), Aurae Impact – a French family office specialising in impact investing, and The Impact Investors.
“Access to safe and affordable drinking water is one of the greatest challenges of our time. We are proud to partner with such a committed and diverse group of investors who share our vision that catalytic investments in scalable, sustainable water businesses are an essential first step to solving this problem,” said Aparna Pittie, deputy fund manager at Antwerp-based Incofin, which has $1.1.bn (€970m) in assets under management.
Access to drinking water
One in three people lack access to safe drinking water, according to a 2019 report by UNICEF and the World Health Organisation. Incofin started the water fund two years ago to show that investing in the safe drinking water market in low-income regions is a viable proposition.
“As the anchor investor and sponsor of the fund, we value Incofin’s ability to bring together investors with different profiles into the emerging sector of access to safe drinking water for vulnerable populations,” said David Grolleau, CFO of Danone Communities.
The fund aims to provide 20 billion litres of water to 30 million people, mainly in Africa and Asia, through investments in innovative water businesses targeting underserved populations.
W2AF, which Incofin said is the first private equity fund dedicated to boosting access to water, has invested in firms including Rite Water in India and SPOUTS International in Uganda. The two companies provide a combined 4.3 billion litres of drinking water to 8.5 million people in low-income communities. The fund is planning further investments in Asia, Africa and Latin America, according to Incofin.
Catalytic capital
Innovative investment solutions such as WA2F are much needed in the water sectors of global emerging markets, according to Irina Gaman, private equity investment officer at the EIB.
“The catalytic role of EIB in this blended finance structure, which benefits from the great support of both private and public investors, is undeniable. We welcome this partnership and wish Incofin success in deploying the Water Access Acceleration Fund,” said Gaman.
Nadia Scharen-Guivel, investment director at the DFC, said that Incofin’s track record in local emerging markets, combined with its ability to offer diversification across regions and small-scale products, provided risk mitigation for investors.
“Furthermore, Incofin’s early engagement with technical assistance and the development of a robust pipeline of vetted projects enabled us to commit confidently at an early stage, thereby lowering entry barriers for new investors,” Scharen-Guivel said.
