Ukraine Investment Fund

The Norwegian government has given Norfund a mandate to invest in Ukraine through a dedicated Ukraine Investment Fund under the Nansen Programme, supporting the country’s reconstruction and building a resilient economy.

Russia’s invasion has caused massive destruction across Ukraine, damaging or destroying critical infrastructure, energy systems, homes and industry. The fund channels capital into businesses and infrastructure projects that are key to rebuilding the country and its long-term growth, projects that would likely not be financed under normal market conditions because of the high risk.

EUR 90 million has already been transferred to the fund. From 2027 to 2030, the Norwegian government will allocate a further EUR 350 million, giving Norfund the long-term predictability needed to invest in Ukrainian businesses together with existing and new partners.

Aim

The purpose of the Ukraine mandate is to contribute to the development of sustainable business activities and job creation in Ukraine. The fund aims to support investments that would not otherwise be undertaken due to the high risk in Ukraine. The Ukraine Investment Fund is also intended to mobilize private capital by encouraging private investors to invest alongside the fund or be inspired by its activities.

Official instructions (in Norwegian)

Norfund’s value proposition

Patient capital: Norfund is a long term investor and we support our portfolio companies to succeed also after we exit.
Sector expertise: With 25 years of investment experience we have deep knowledge in our preferred investment areas.
Agile and nimble: Norfund is a lean organization, with unbureaucratic decision processes and are able to cooperate in a agile way.
Serious long-term commitment: Norfund is a reputable and professional investor and we are backing the recovery of Ukraine from a long term perspective

Investment approach

Norfund is a commercial investor, and financial returns is a precondition for our investment. Companies only survive if they are profitable over time, so profitability is essential for the creation of sustainable jobs and lasting development effects. Delivering positive returns is also important for Norfund to be catalytic, mobilizing private investors to invest with us – or inspired by us. We aim to exit our investments when we are no longer needed, enabling us to recycle the capital into new investment opportunities.

Applicable to all projects in all sectors

Investment size: USD 5-50 million, ideally USD 15-25 million
Debt: Maximum 40% of the capital (equity + debt) in the company
Equity: Maximum shareholding of 35%
Secondary capital: part buy-out only done on exceptional basis
Domicile and focus of company activity: Investee company may be domiciled outside of, but funds should be deployed in Ukraine
Business Integrity: Satisfies Know-Your-Customer and Anti-Money-Laundering requirements
Environmental and Social: Broadly aligned with IFC Performance Standards; activity not listed on European Development Finance Institutions Exclusion List; and comply with Norfund’s Fossile Fuel Standard
Sponsor: A company or person(s) with demonstrated competence and track record in the relevant sector, financial strength, and with meaningful “skin in the game” (e.g. ownership)
Clear business plan: based on competitive positioning and growth opportunities

Typical renewable energy projects

Project size: Utility scale (30MW+), or smaller distributed assets with strong fundamentals
Technology: Bankable and proven technology (PV, onshore wind, BESS)
Capital structure: bankable financing plan with appropriate leverage
Project maturity: preferably ready-to-build or late-stage development
Offtake: revenue visibility
EPC & construction: credible contractor and risk allocation
Grid access: confirmed interconnection, assessed curtailment / grid risk
Operations: proven track record, credible operations & maintenance setup
Resource: independently validated and realistic production assumptions
Permitting & land: permits secured or advanced, land rights clear
Environment, Social and Governance risks understood and manageable

Typical manufacturing and agribusiness

Company size: growth stage; usually with growing EBITDA of 5 mUSD
Technology: Value-added processing/manufacturing, not just primary production
Economics: Cost competitive unit economics, or clear differentiation

Typical banks

Market share: Top 5-20 banks in the country
Total equity: above 50 mUSD
Healthy financials: capital adequacy, asset quality, liquidity, profitability and risk
Adherence to local regulatory requirements
Use of funds: Growth capital must go towards increasing the loan book

More about Norfund as an investor

Norfund invests on commercial terms. We are an active investor, offering patient long-term capital. We strive to be lean and efficient, with short decision-making processes.