Climate-focused Regenerate Asset Management said larger British peer M&G will invest up to 150 million euros ($165.12 million) in the firm’s inaugural fund and take an equity stake in the company.

Regenerate, launched in 2019, is part of a growing group of asset managers focused on accelerating action to better manage the world’s “natural capital” as part of the global effort to limit climate change and protect biodiversity.

Focused on private-market assets that can have a measurable impact, Regenerate said M&G was the cornerstone investor for its first close of the fund, dubbed the Regenerate European Sustainable Agriculture Fund.

The firm said the fund will invest directly in agricultural businesses growing and supplying “regenerative and climate positive produce in Europe”, including through improving soil health, water conservation, emissions and biodiversity.

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The size of M&G’s equity stake in the firm, to be taken through its Catalyst strategy, was not disclosed.

“Regenerative agriculture is an increasingly important part of institutional investment in North America and Canada, but under-invested here in Europe,” Regenerate Chief Executive Ben Stafford said.”Our fund is the first of its kind, offering our clients exposure to an asset class which provides real asset diversification, deep and long-term positive impact with inflation linkage.”

Both Stafford and Regenerate’s Chief Investment Officer Ryan Cameron previously worked together for more than a decade at sustainability-focused investor Impax, financing and managing assets including wind farms in Finland and Ireland.

Regenerate’s team of 14 investment staff is based in Yorkshire and London. The firm also has a venture capital arm focused on agriculture technology.

“We are proud to support Regenerate with this pioneering fund which aims to reduce agriculture’s impact on the environment, improve human health and social outcomes, and achieve attractive risk-adjusted returns,” said Niranjan Sirdeshpande, Global Head of Investment at Catalyst.