Dutch eco-shipping finance start-up Prow Capital is ready to start spending its initial cash pot next year.

Asked if the €420m ($472m) announced for its Green Shipping Fund had been raised, investment manager Gust Biesbroeck told TradeWinds: "Yes. We are open for business."

"Feedback from our prospective customers so far has been very positive as an alternative source of funding with a focus on and knowledge of the challenges around decarbonisation," the former ABN Amro executive said.

And he added: "We already have built a significant and concrete pipeline of transactions. We expect to close our first transactions in first quarter 2022."

Unnamed third-party investors have contributed to the fund, as have the partners in Prow Capital, a group of seasoned Dutch transport finance professionals, including Biesbroeck.

Strong belief

This underlines their strong belief in the fund's mission, Biesbroeck said.

Funding has been structured and arranged in close cooperation with Spanish lender Banco Santander, supported by financial services group FPG AIM.

Biesbroeck explained that the investment team has been put together through existing networks, which were built earlier through sustainability-related and maritime finance activities.

Expertise on board includes former executives from Fortis Bank and ABN Amro.

This ensures "a diverse skill set" is represented in the team, including ship finance, fund management, environmental, social and corporate governance (ESG), and last but not least maritime technology, the financier added.

"We have been amazed and excited by how much can be achieved by online interaction and cooperation, also when setting up a new and innovative venture like Prow Capital," Biesbroeck said.

The fund will provide loans to European owners for new and existing vessels or retrofits that comply with ESG criteria and that lower emissions to meet International Maritime Organization decarbonisation targets.

To qualify for financing, vessels must outperform relevant emissions regulations.

A meeting of minds

Biesbroeck said Spain's Banco Santander showed strong interest in the transaction from the start, as Prow Capital's initiative fitted the bank's ambitions in the Netherlands, in combination with its strategic focus on the energy transition.

Amsterdam-based Prow Capital's private debt fund aims to help fill the gap left by the retreat of traditional lending banks from shipping.

Prow Capital is seeing demand for green investments from shipowners and investors.

"We see real investment in green ships and decarbonisation picking up significantly. Investors are increasingly focused on the green angle in shipping as well," Biesbroeck said.

With an average loan size of €15m to €50m and strict eligibility criteria, the fund provides competitively priced pre and post-delivery senior secured debt financing.

Biesbroeck has more than three decades of experience in the Netherlands, Greece and Hong Kong.

He previously served as global head and managing director of transport clients for ABN Amro.