Japan’s largest banking group MUFG Bank, in partnership with Mitsubishi Corporation and Pavilion Private Equity, has established a fund that will invest primarily in companies dedicated to decarbonization through the development of climate technology.

The Marunouchi Climate Tech Growth Fund is managed by Marunouchi Innovation Partners (MIP), a company jointly established by the three partners. The fund has raised US$400 million in capital commitments from investors at its first close. MIP plans to raise US$800 million to US$1 billion by the fund's final closing.

By investing in climate tech start-ups, the fund aims to commercialize and spread advanced technologies owned by investees while increasing their corporate value and contributing to solving issues related to global climate change.

Through the fund, MUFG says it will work with its main sponsor, the Mitsubishi Corporation Group, using its industry knowledge and business networks, and other participating investors to capture investment opportunities and support the growth of investee companies.