The International Finance Corp. has announced that it will invest in a private equity fund that supports companies in the clean energy and environmental sectors.

IFC will invest $15 million, according to the organization's press release. The money will be managed by Aloe Private Equity, a French management company that plans to invest in companies primarily in India and China.

The focus will be on clean and renewable energy, waste recycling, emissions controls and eco-processes, IFC said in its release.

Swedfund, a risk capital company owned by the Swedish government, and Proparco, the private sector financing arm of the French Development Agency, will invest $8 million and $5 million, respectively, in the fund alongside IFC.

Aloe Private Equity, set up in 2004, recently raised over $110 million for its Aloe Environment Fund 2, which will invest in companies in Asia and Europe. The fund in which IFC will participate will co-invest alongside Aloe 2.

Aloe Private Equity has invested in Greenko, an Indian biomass company. It also has invested in firms that focus on coal bed methane recovery, energy efficiency, and the recycling of materials such as batteries, plastic, steel dust, and fly ash.

“IFC's investment and its strong support of our private equity business model would be of great value to us. It (IFC) has a tremendous amount of expertise in the clean energy and environment sectors and this would go a long way in helping us pursue our strategy to expand in Asia," Vivek Tandon, general partner at Aloe Private Equity, said in IFC's press release.

Haydee Celaya, IFC's director of funds, said, "Aloe Private Equity's innovative investment strategy will help address some of the major challenges and opportunities for sustainable economic development in Asia's emerging markets."

Red Herring's Sufia Tippu reported from Bangalore