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MEAG, the asset manager of the Munich Re Group, today announced that it has raised $207 million in capital commitments in the first closing of the MEAG Sustainable Forestry Equity Fund.
Established in 2022, the Article 9 Fund will invest in ecologically sustainable forest management in line with the definition of the EU taxonomy, in addition to contributing to several goals of the UN SDGs.
The fund’s first investments are scheduled for the first half of 2024, with a focus on forests in the United States, New Zealand and Australia, with 5% of assets expected to be invested in new tree plantations.
Thomas Bayer, MEAG Managing Director and Global Head of Illiquid Assets, said:
“MEAG has decades of experience with forestry investments around the world, which has proven to be an important stabilizing factor for our portfolio. We are even more pleased with the successful first closing of the fund above USD.”
According to MEAG, investments in forests offer the potential for long-term value growth due to the increasing global demand for wood, particularly due to the trend towards sustainable construction and materials, as well as the correlation with other investment classes. It offers the advantage of low The company added that the fund will help institutional investors integrate environmental and social aspects into their investments, with forests promoting biodiversity and carbon sequestration while providing employment and recreational space.
Frank Becker, MEAG Managing Director for Institutional Customers, said:
“The forestry asset class is still uncharted territory for many investors. Our years of expertise have helped build confidence in this exciting asset class. Combining long-term returns with sustainability. MEAG, a subsidiary of Munich Re, is also ideally placed to develop needs-based solutions for its customers, thanks to its long experience in the field of risk management and sustainability. It is located in.”
Capital for the initial closing was provided by a German insurance company and a pension plan of a group of DAX-listed companies. MEAG has set a goal for the fund at $500 million to $700 million.
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