|
EBRD, Global Finance and EU launch Private Equity Fund
Up to €20 million to help entrepreneurs in Bulgaria and Romania to grow
The EBRD and Global Finance SA, the biggest private equity investment company in southeast Europe, are setting up a private equity growth fund to target small and medium-sized enterprises (SMEs) in Bulgaria and Romania. Other investors include Bulgarian Post Bank, Banc Post Romania and the European Commission with €6.5 million through the equity window of the EU/EBRD SME Finance Facility. The initial capital will be €16.25 million, which could be extended to €20 million.
The new Global Bulgaria and Romania Growth Fund expects to make equity investments with an average size of €800,000 in growth-oriented SMEs, taking both minority and majority stakes. Managed by Global Finance, the fund will mainly target companies that are led by strong management, have good potential for growth and are building strong brand names and distribution networks, while taking strong positions in the local markets. It will also look for companies that are using local resources and are highly competitive within their field.
John Chomel-Doe, head of the EBRD’s office in Bulgaria, said equity funds that support SMEs are crucial in countries like Bulgaria and Romania. A key factor for the growth and vitality of SMEs is access to finance, which the Global Bulgaria and Romania Growth Fund will provide, added Mr Chomel-Doe. Growing businesses are the building blocks for all economies, but these businesses must grow further if economies are to remain strong. The new fund aims to help do just that.
Established in Greece in 1991, Global Finance manages over €400 million throughout the region, including through the Black Sea Fund, which makes investments in the Balkans in the $5-10 million range. Global Finance also provides its investee companies with hands-on management support, follow-on financing capacity, the ability to attract strategic partners, and access to an extensive network of relationships, including clients, suppliers, professional advisors and financial institutions.
Emil Ivanov, General Manager at Global Finance Sofia, said: “Global Finance backs businesspeople and entrepreneurs with a proven track record and dedication to their companies, who are able to lead their businesses to top performance.”
The SME Finance Facility was launched in 1999 under the Phare Programme -- the main channel for the European Union's financial and technical cooperation with the EU accession countries -- with the EBRD. It aims to encourage institution building in the financial sector and the growth and development of SMEs by providing access to loans, leasing and equity finance from local financial intermediaries. The budget earmarked for the Phare Programme in 2000-2006 is about €11 billion.
|
