We find ourselves at the intersection of one of the largest global investment opportunities. This arises from decades of underinvestment in global infrastructure; the emergence of technologies that are driving the digitisation and electrification of economies; the global climate agenda and robust demographic factors.
In this environment, from East to West, state and corporate actors are doubling down on building resilience in their data, energy and supply chain systems.
They are looking for partners to build this critical infrastructure. Actis has been building and operating essential infrastructure for over 20 years, from renewable energy to roads and logistics, to the data centres so increasingly crucial to our daily digital lives. We have built over 200 assets in over 40 countries, through the Global Financial Crisis, through COVID-19, our customers see us as a reliable partner for delivering infrastructure.
This is One Actis, it is the brand and the multi-disciplinary platform that customers look for in the delivery of essential infrastructure. It is the connection that operating at the confluence of these previously distinct sectors enables and cross pollination of insights and networks. Our teams work together as One Actis.
Growing energy demands and the shift to renewables
A major focus for the global energy market is to meet the exponential demand growth for electricity in a carbon-neutral way. Electrifying and transitioning the global economy requires a rewire and replumb of the planet’s infrastructure and built environment. This will be a capital-intensive job. Making sure electricity flows where and how it needs to demands a reliance on renewable energy and complex new storage systems, as well as investment in the enabling environment, for example, transmission grids and distribution networks. This is an investment opportunity of a lifetime, one that will only be financed and delivered if returns meet expectations. And that’s where One Actis comes to the fore.
One Actis
There’s a synergy created from our cross-sector understanding but also the depth of our networks and relationships. Our 20 year history enables us to leverage our insights, track record and relationships to bring a superior level of analysis to the countries where we operate and the people we engage with.
An example of this is South Korea, where our real estate team has been developing and operating a variety of assets over the last decade. We recently launched a renewable energy business there, as part of our Asia Climate strategy. The local real estate team was able to offer support with land use, permits and construction processes as well insights into South Korean culture and local market introductions to enable the launch. Further, much of the renewable opportunity is connected to real estate owners buying power. The ability to draw on the expertise of our energy teams from Asia, working together with our local real estate team is invaluable.
Similarly in real estate, last year we exited an industrial park development in Vietnam. Critical to its success was our operating partner and occupiers, who were attracted to Actis by the strategic value we brought in both real estate and renewable energy.
Another example is Emicool, a leading district cooling provider in the Gulf region. Emicool is collaborating with another Actis portfolio company, Yellow Door Energy, a leading solar business in the region on renewable power for its plants. Emicool’s main input costs are electricity and water. Improving electrical efficiency is a crucial driver of both financial returns and our sustainability agenda. Here, we can leverage our experience in both energy and infrastructure operations. Over time, we hope to use our growing expertise in cooling to support our data centre infrastructure globally.
Actis’ operations and value creation team optimises value and aligns risk to the financial performance and scale of Actis, in a way external technical consultants cannot. We’re able to identify a value opportunity in an operating or under construction asset, whether it’s a wind farm, a solar project, a power plant or a toll road, by comparing it to hundreds of previous projects from the Actis portfolio. It’s about drawing on our cross-sector experience and constantly looking for the upside.
There are synergies where we might be dealing with the same supplier in multiple countries. There are also cases where we see an issue multiple times that any single management team will only ever see once in their career, just by the breadth of what we cover. Our management teams really value learning from one another and understanding the synergies and commonalities in the issues they face.
Digitalising the global economy
Hyperscalers are an excellent example of how Actis’ expertise across real estate, energy and digital infrastructure combines to offer a competitive advantage. With the growth of AI their needs for new green infrastructure have increased exponentially and with growing land access constraints in traditional markets they are increasingly looking to our markets for new large-scale solutions, for example Johor Bahru in Malaysia to serve the Singapore market.
Through our deep sector specialism and our builder and operator model, we are well-positioned to develop solutions for these customers: today we are building data centres for hyperscalers across Asia in our real estate business, while at the same time providing renewable energy through our energy platforms, using our global relationships and insight to enhance both. We see a future where we offer more integrated solutions that will be compelling for these customers, while enabling us to access a superior investment opportunity.
Our decades of real estate, digital and renewable energy experience in our markets allow us to anticipate this in a way that others will struggle to match and action, particularly when integrated with our sustainability approach that focuses on skills development, job creation and industrial contribution to support a Just Transition in the countries where we invest.
Take the example of NextStream, a leading digital infrastructure business in Latin America and the US, where the Actis Long Life Infrastructure Fund (ALLIF) purchased 11 data centres from Telefonica and Asterion. The ALLIF team drew heavily on the experience of the Actis real estate team, which has been building and operating data centres across Asia for a long time. At the same time, NextStream is also looking to use more renewable energy and is relying on the energy team in Latin America, with its deep technical and local market knowledge. Using the resources of the whole firm, supporting our specialist teams, we are able deliver acquisition and optimisation of high-quality operating assets. NextStream is building a risk management framework focusing on preventing environmental, social, occupational and fire risks. The platform is exploring decarbonisation and operational optimisation opportunities, including water and energy efficiency, and low-carbon energy solutions. The business will also look to drive social impact through digital skills training in local communities.
The tip of the iceberg
These examples draw on market knowledge and access, grid power and renewable power plus a major crossover of clients. But it’s just the tip of the iceberg in terms of the synergies and opportunities we are driving with One Actis. It is part of our DNA as builders and operators to use the combination of local market and deep sector expertise to acquire and build high-quality assets. An example of this is our renewable energy business in India, BluPine Energy, which is our third repetition of the same strategy, in a market with one of the world’s largest and most comprehensive plans towards energy transition. BluPine Energy has recently won its first hybrid project combining wind, solar and battery storage on the same site.
In this edition you will find eight specific examples we chose to demonstrate the One Actis approach. You will see we have asked the CEOs of these companies to give their perspectives and paired their voices with the views of our own team. There are dozens more examples, including businesses where we have delivered successful and profitable exits for our investors. We have great confidence we can continue to do so in the future.
The One Actis approach is about expertise, insight, common experience, relationships and networks. By understanding what’s happening on the energy side, for example, you can think more coherently about how you transition a real estate asset. Being focused on the transition, it gives us a broader field of play and expertise with lots of joined up parts. Ultimately the more we can work together, the more we can contribute to global solutions required and deliver superior performance in possibly the largest investment opportunities of our age.