|
Private equity fund to develop capital market in CEE
EBRD participates in Polish Enterprise Fund V
One of the main challenges facing the countries of central and eastern Europe on the eve of EU accession is the long-term development of a strong capital market. To support these efforts the EBRD is committing up to €60 million to the Polish Enterprise Fund V, a follow-up fund to earlier successful funds managed by Enterprise Investors. The Fund will focus on investments in Poland, however, it will invest up to 40 per cent of the total capital in the central European region, with the main focus outside Poland on Romania and Bulgaria.
As private equity invested in the region remains well below the European average and the environment for fund raising is difficult, the EBRD’s continued involvement remains critical, said Kurt Geiger, the Bank’s Business Group Director Financial Institutions. While leading investors are intrigued by the opportunities associated with EU enlargement, they seek more evidence of the accession impact on the local economies. With more than 12 years of experience in the region, the EBRD can serve as a strong partner here, he added.
"We welcome the EBRD's decision to join us in PEF V", said Jacek Siwicki, Managing Partner of Enterprise Investors. "Their decision to invest in our fund helped us convince other financial investors about the attractiveness of the region and confirm our good track record."
The level of private equity investments in central and eastern Europe relative to GDP still lags behind the west European average: Whereas the latter was more than 0.2 per cent, it was 0.06 percent in Poland, 0.05 per cent in the Czech Republic and 0.03 per cent in Hungary as of end 2002. The region has also been affected by the downturn of private equity raised globally and a lack of domestic sources.
Enterprise Investors is one of the most established fund management companies operating in central and eastern Europe. It now seeks to replicate its successful performance in Poland, where it has been operating since 1990, more widely in the region. As of September 2003, Enterprise Investors invested more than $658 million in 91 companies and continues to have a strong pipeline.
|
