Baring Vostok Private Equity Fund V

Location:

Regional

Project number:

43703

Business sector:

Equity funds

Notice type:

Private

Environmental category:

FI

Approval date:

29 May 2012

Status:

Disbursing

PSD disclosed:

27 Apr 2012

Project Description

The EBRD is considering an equity investment of up to USD 100 million in aggregate in favour of Baring Vostok Private Equity Fund V L.P. (the “Main Fund”) and Baring Vostok Private Equity Fund V Supplemental Fund L.P. (the “Supplemental Fund”) (together the “Fund”), two separate closed-end investment vehicles structured as limited partnerships, domiciled and governed under the laws of Guernsey.

The Supplemental Fund will co-invest with the Main Fund in transactions that are of a size and scale that exceed the Main Fund’s desired diversification limit and strategy.

The project will mobilise private sector funds to enable the Fund to make equity and equity-related investments primarily in medium-sized companies operating in the Russian Federation, Kazakhstan and Ukraine as well as in other CIS countries and Mongolia (the “Region”), with the objective of achieving long term capital growth.

Transition Impact

By investing in the Fund, the EBRD will support a leading, locally based Fund Manager with a strong track record who will continue to support the growth and expansion of mid-market companies. The key transition impact areas for the Fund are expected to be:
(i) expansion of the private equity market, which still remains underdeveloped in the Region and one of the most difficult and volatile markets;
(ii) support of the local economy by providing capital and operational expertise to local mid-sized companies;
(iii) expansion of the investors’ base, with the Fund Manager attracting new institutional investors into the Region;
(iv) implementation or further enhancement of standards of sound corporate governance and business conduct in the Fund and investee companies through best operational practices.

The Client

The Fund will be advised by Baring Vostok Capital Partners Limited (“the Investment Adviser”) and managed by Baring Vostok Fund V Managers (“the Investment Manager”), both of which are Guernsey-registered companies and regulated by the Guernsey Financial Services Commission.

Since 1994, the Investment Adviser has invested about USD 1.5 billion of capital into 55 portfolio companies in Russia and the CIS. The Investment Adviser has a successful track record in all forms of private equity investments in CIS which is evidenced by successful exits, good corporate governance history, significant industry expertise, deep network of contacts with entrepreneurs, services providers, auditors, accountants, etc. that are crucial for any long-term business strategy.

EBRD Finance

The Bank will invest up to an aggregate amount of USD 100 million in equity into the Main Fund and the Supplemental Fund.

Project Cost

Target Main Fund size: USD 1 billion

Target Supplemental Fund size: USD 450 million

Environmental Impact

The project has been assigned a screening category of FI, as the EBRD financing is via a financial intermediary.

The Fund will comply with the EBRD's Performance Requirement 2 (Labour and Working Conditions) and Performance Requirement 9 (Financial Intermediaries).

The Fund should ensure investee companies comply with national environmental and OHS standards and national labour laws and ILO labour standards. The Fund is already implementing EBRD''s Environmental and Social Requirements under its existing transaction and has a member of the Fund who is responsible for implementation and oversight of environmental and social issues affecting the Fund and its portfolio. The Fund will be required to submit Annual Environmental and Social Reports to the Bank.

Technical Cooperation

None.

Company Contact

Michael Calvey , Senior Partner
Ducat Place II, Suite 750, Gasheka str. 7, bldg 1
Moscow, 123056, Russia

Tel: +7 495 967 13 07
Fax: +7 495 967 13 08

Business opportunities

For business opportunities or procurement, contact the client company.

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