Temasek among cornerstone investors for LeapFrog’s latest fund
Other cornerstone investors for the private equity firm’s fourth fund include AIA, Prudential, the European Investment Bank and the United States’ International Development Finance Corporation
TEMASEK is among the cornerstone investors for the latest fund from LeapFrog Investments, a private equity firm that focuses on sustainability-related investments in emerging markets.
In addition to the Singapore state investor, other cornerstone investors for its fourth fund – which closed last Tuesday (Nov 26) with investments totalling US$1.02 billion – included AIA and Prudential Financial, along with development financial institutions such as the European Investment Bank and the United States’ International Development Finance Corporation.
LeapFrog also drew significant commitments from global asset managers such as Sumitomo Mitsui Trust Bank and Van Lanschot Kempen, healthcare strategic investor Eli Lilly and Company, and foundations and endowments such as the Ford Foundation and the IMAS Foundation, a foundation set up by the founder of global furniture company Ikea.
The US$1.02 billion raised – out of an initial target of US$1 billion – included US$808 million of primary fund commitments and up to US$210 million of pre-allocated co-investment.
The purpose of this fund is to accelerate high-impact healthcare and financial services companies in global growth markets.
Along with an additional partnership with Prudential Financial to invest in an African financial services firm Alexander Forbes, new allocations to the LeapFrog’s healthcare and financial services investments across the recent fundraising cycle has increased to more than US$1.15 billion.
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Temasek has a minority stake in LeapFrog investments, after the state investor entered into a US$500 million strategic partnership with the firm in March 2021.
In November last year, the state investor joined forces with the private equity firm and the European Investment Bank to invest US$500 million in companies that provide green solutions in Africa and emerging Asia.
For its latest fund, LeapFrog said it did not just raise capital from longstanding investors such as Temasek.
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New investors
A significant amount of funds were also raised from new investors, with a broadened investor base into new markets such as Singapore, China, Japan, Austria, Norway, Oman and Turkey. It added that more than 50 per cent of capital from Asia included investors from Japan, Singapore and China that are investing with them for the first time.
“These relationships provide the foothold for LeapFrog to further promote authentic impact investing in diverse regions, expanding the commercial success and mission of impact investing across the globe,” said LeapFrog in a press release.
This fund aims to support 100 million people in emerging markets and has reached 24 million people so far through investments in five initial companies that have achieved strong revenue growth over the past year.
The companies are:
- Diagnostics business Redcliffe Labs, which has conducted more than 20 million tests for Indian patients using a decentralised network of 76 laboratories and over 1,600 collection centres.
- Off-grid solar financier Sun King, which has provided 118 million people with access to solar energy, while saving low-income households more than US$7.2 billion in energy expenses that would otherwise have paid for biomass, kerosene lamps and diesel generators.
- Insurtech company bolttech, which uses embedded insurance to offer tailored and low-cost policies across 35 markets, including Indonesia, the Philippines, Thailand and Vietnam.
- Lending company Electronica Finance, which provides loans for machines, equipment, rooftop solar and other purposes to small and medium-sized enterprises in India. It has trebled assets under management over the last five years.
- Higher-education lender Auxilo Finserve which has seen 75 per cent compounded annual growth in its loan book across the last three years.
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