Nomura Holdings, Inc. (Nomura) today announced that it has entered into an agreement through a subsidiary to invest in Tropical Asia Forest Fund 2 L.P. (TAFF2), a Southeast Asia forestry fund managed by New Forests Asia (Singapore) Pte Ltd (NF Asia). This is Nomura’s first investment into a forest fund managed by New Forests Pty Limited (New Forests). NF Asia is a wholly owned subsidiary of New Forests1 , a Nomura affiliate and forestry asset management company. Mitsui & Co., Ltd., a joint shareholder of New Forests, has also signed an investment agreement with TAFF2.
New Forests is the second largest unlisted forestry asset management company in the world and the largest one in Asia Pacific. NF Asia is a key subsidiary for New Forests in Southeast Asia. The fund manages forestry and nature-based assets with an emphasis on environmental value and positive engagement with local communities, providing a sustainable timber supply. TAFF2 is New Forests’ second fund investing in Southeast Asia, and aims to contribute to climate change mitigation, biodiversity protection, and sustainable forest conservation as part of its investment thesis.
Nomura seeks to obtain a share of excess carbon credits generated through the fund investments in forestry and carbon projects, as well as gaining financial returns. Carbon credits offset greenhouse gas emissions that are difficult for companies to eliminate and reduce, leading to decarbonization and reduction of greenhouse gas emissions in society as a whole. Demand for carbon credits is expected to continue growing globally.
In addition to acquiring knowledge and expertise on forestry resources and carbon credits, Nomura will focus on creating related businesses globally to take advantage of growth opportunities. Nomura is also leveraging its global platform, including wholly owned subsidiary Nomura Asset Management, to market multiple funds managed by New Forests, including TAFF2, to clients in Japan and overseas.
In May 2022, Mitsui and Nomura agreed to acquire 100% of New Forests. Under the agreement, Mitsui increased its stake in the asset manager to 49% from the 23% interest it acquired in 2016, with Nomura securing a 41% ownership. The remaining shares are being distributed to New Forests employees.
New Forests is a global investment manager of nature-based real assets and natural capital strategies, with AUD 10.73 billion (USD 7.3 billion) in assets under management across more than 1.2 million hectares (3.14 million acres) of investments.