Circulate Capital, the Singapore-based investment manager, has raised $220 million for the first close of Circulate Capital Asia II.
This represents more than 70 percent of the fund’s overall target of $300 million and already surpasses Fund I, which stood at $188 million, the firm said in a statement on Wednesday.
According to the statement, the fund will now deploy growth capital to scale circular supply chains and recycling businesses across South and Southeast Asia, with a focus on plastic solutions and packaging, as well as electronics and apparel.
Meanwhile, a diverse group of global investors, including strategic corporates, Development Finance institutions (DFIs), and institutional and family office LPs, drove this latest fundraise.
Returning corporates such as The Coca-Cola Company, Danone, Dow, and Procter & Gamble reaffirmed their commitment to the strategy for Fund II, joining existing DFIs British International Investment, the French DFI Proparco, and the International Finance Corporation (IFC), along with leading family office Builders Vision.
The fund’s momentum also accelerated with a robust cohort of new institutional partners.
These include the Emerging Markets Climate Action Fund (EMCAF), co-managed by Allianz Global Investors and the European Investment Bank, as well as a Dutch pension fund through Achmea Investment Management’s Impact Platform, and public institutions such as Impact Fund Denmark (IFDK), the Swiss DFI SIFEM, managed by responsAbility Investments AG, and Australian Development Investments (ADI).
The investor base was further diversified by high-profile family offices and impact investors, including Stella (the investment entity of the Heinz Hermann Thiele family foundation), Clotho Family Office, Netherlands-based impact specialist Wire Group, and Fondation Prince Albert II de Monaco.
To capitalize on this opportunity, Fund II will execute high-growth investments in key markets such as India, Indonesia, Thailand, Vietnam, the Philippines, and Malaysia.
Real-world examples include scaling mature plastic recycling streams, such as PET; building nascent markets for other plastic materials, including polyolefins; driving innovation in alternative paper-based packaging solutions; recovering critical and rare earth materials trapped in recyclable electronics and batteries.
“Circulate Capital is the first and only private markets manager to bet exclusively on circular supply chains across South and Southeast Asia,” said Rob Kaplan, Founder and Chief Executive Officer of Circulate Capital.
“Our track record of successful exits demonstrates that the circular economy is no longer just a subset of environmental, social, and governance (ESG )or sustainability. It is a sophisticated asset class that can deliver liquidity to private equity investors,
“With Fund II, we are ready to scale and capture the massive growth potential inherent in these high-velocity economies, to build businesses that deliver financial and impact returns for our investors,” he added.
It is noted that the Fund II will aim to finance nearly two million tons of collection and recycling capacity.
Over ten years, these investments are projected to prevent a cumulative 30 million tonnes of unmanaged waste; avoid or reduce more than 50 million tonnes of carbon dioxide (CO2) emissions, with at least 50 percent of the portfolio aligned to 2x gender smart investing targets on exit.
“Building circular supply chains takes long-term commitment and strong collaboration across the value chain. Our reinvestment in Circulate Capital through Asia Fund II reflects our belief that scaling inclusive recycling systems is essential to keep materials in use, strengthen local ecosystems, and build more resilient supply chains,
“Through this partnership, we see an opportunity to develop solutions that create lasting value for people, industry, and the planet,” said Jean-Yves Krummenacher, Global Chief Procurement Officer, Danone.
Keith Cleason, President, Packaging & Specialty Plastics, Dow, said Circulate Capital’s initiative has delivered tangible impact in areas key to progressing circularity across the ecosystem, such as expanding capacity of mechanical recycling and enabling flexible recycling.
“Dow remains committed to bringing together ideas from across the value chain to deliver new solutions in circularity, and we look forward to continued collaboration as Fund II builds on this momentum in South and Southeast Asia,” he added.
Chris Wu, Vice President, Investments at Builders Vision, said paired with a rigorous approach to impact measurement and a clear ability to cultivate proprietary deal flow in the region, Circulate Capital has developed a distinctive advantage in sourcing high-quality opportunities in the circular supply chain.
“We look forward to continuing to build alongside a team that is demonstrating how addressing the plastic crisis can be both scalable and commercially compelling,” he added.
Peter Ellersiek, Co-lead Portfolio Manager, Emerging Market Climate Action Fund (EMCAF), said they decided to support Circulate Capital with EMCAF because their specialist focus enables a clearly differentiated market positioning and delivers tangible value to portfolio companies and investors alongside strong environmental impact.