State-owned COFIDES has recently announced investments from two of its funds, the €400m Social Impact Fund, and the €2bn Co-investment Fund. Both funds are backed by financing from the post-COVID EU’s Recovery and Resilience Facility.
Spain’s COFIDES has lined up the first investments from the €400m Social Impact Fund (SIF) and €2bn Co-investment Fund (COFO), which it manages on behalf of the Spanish state.
Both funds were created in 2024 as part of an EU-backed Recovery, Transformation and Resilience Plan to support Spain’s social and economic recovery after the COVID pandemic hit the country hard. The funds are backed by financing from the EU’s Recovery and Resilience Facility. Both funds must be fully allocated by June 2026.
COFIDES manages the funds in its capacity as a trading company owned by the Spanish government, tasked with supporting the economy, attracting foreign investment, promoting the impact economy and contributing to global development.
The €400m SIF was established last year specifically to provide impact investment in support of SMEs operating in Spain committed to tackling social and environmental challenges. Its first investments are a €30m commitment to the IB Deuda Impacto España fund, and a €19.5m investment in the Q-Impact Fund II.
“These first SIF’s operations culminate months of intense work to launch this fund, a unique instrument in Spain and with few precedents internationally, which is set to transform and strengthen impact investment and the social entrepreneurship ecosystem in our country,” Ángela Pérez, COFIDES’ chair and CEO, said.
The IB Deuda Impacto España fund was launched in 2023 by Spanish fund manager Impact Bridge Asset Management, which said then it would be Spain’s largest social impact fund, aiming to attract €150m. Early commitments came from investors including the European Investment Fund, CaixaBank’s social investment bank MicroBank, and the Instituto de Crédito Oficial, as well as family offices and private investors.
The fund invests in themes, such as rural development, decent employment, social inclusion, energy efficiency, sustainable agriculture and the circular economy.
In addition to the €30m investment, the SIF will also provide €100,000 in technical assistance to the IB Deuda Impacto España fund for training in social impact supplier procurement and contracting.
Q-Impact Fund II, the other SIF investment destination, is a growth equity fund launched in 2022 by Madrid-based fund manager Q-Impact Investment Management, with a target size of €120m. Among its focus areas are education, social inclusion, energy efficiency, the development of new fuels and reforestation.
Foreign investment drive
Separately, COFIDES has also announced the first three investments, totalling €220m, from FOCO, which co-invest with foreign investors in companies operating in Spain that have activities related to the environment, the digital transition, biotechnology and technological innovation. It is also able to take equity stakes in investment vehicles that mobilise foreign investment.
FOCO is committing €50m to the Azora European Climate Solutions Fund, managed by Madrid-based Azora, which invests in lower-mid market companies that provides decarbonisation solutions for real assets.
It is also contributing €150m to the Eurazeo Growth Fund IV, managed by Eurazeo, which invests in Spanish growth-stage companies providing software, fintech, digital health tech and other digital solutions.
For the third investment, FOCO is committing up to €20m to the Clean Hydrogen Equipment Fund, managed by clean hydrogen investment specialist Hy24. This investment is expected to help generate additional foreign investment that will enable the fund to double FOCO’s investment in projects in Spain.
FOCO is making investments in the €10-€150m range, which are conditional on the mobilisation of additional financing from international investors totalling at least the same amount as that FOCO provides.
