* Alternative Energy ABL Fund

	Alternative Energy ABL Fund Gains Momentum from Credit Crunch
posted on Monday 6 Oct 2008 07:29 BST
While many hedge funds across Wall Street are closing down from rising redemptions and poor performance, one emerging fund has found that the current market turmoil has actually increased investors’ interest in their fund. The Aurarian Capital Clean Energy Asset Based Lending Fund will launch on October 31, 2008. The fund will provide assetbased loans to finance renewable energy power plants and biofuel refineries. Asset-based lending strategies are clear winners in the current market environment due to their lack of correlation to the broader market indices, but the increased attention to the Clean Energy ABL fund can be partially attributed to the credit market collapse. Last week, the Fund signed its first binding term sheet with a biofuels developer for a $78 million investment, with the right to finance three additional plants of increasing size and profitability. The biofuels developer, like many of its peers, was unable to secure credit from traditional lenders due to the ongoing credit crunch. Following a due diligence process, Aurarian was able to step in and fill this “financing gap.” SAC veteran and founder Jason Gold leads the team ensuring proper technology and business model due diligence while co-portfolio manager Kent Larsen leads the team in deal structuring. Although he didn’t reveal all the terms of the deal, Gold indicated that the interest rate Aurarian would receive on the debt would be 20%. Coupled with the additional fees, warrants and Aurarian’s share of the tax credits, the returns would likely be “comfortably north of 20%.” Gold continued, “This deal provides us with over $1 billion of backlog that we’ll be able to fund at very attractive terms. I’m pleased that we will launch with such a profitable set of deals in our arsenal.” “And while we certainly feel badly for those whose businesses have been adversely affected by the constrained credit environment, one positive outcome of this overwhelming negative is that deal-flow for our project finance model has expanded materially. Our experience in proper structuring of these deals made us a lender of preferred resort in the alternative energy industry,” said Gold. Strong governmental and social support behind the clean-energy movement has created a model that investors seem to find compelling, but this is only the beginning. “The demand for this fund has exceeded my most optimistic estimates” said Gold. “An investor scale-back now is likely at the fund’s launch, and our new priority is to partner with the right investors who bring long term strategic significance.”