Dutch state-owned entrepreneurial development bank Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden NV (FMO) is considering injecting an additional $1.4 million in a second fund for Singapore-registered private equity fund manager Emerging Markets Investment Advisers (EMIA).
The move aims to broaden its portfolio in Cambodia, Laos and Myanmar amid the Covid-19 crisis and replenish follow-on reserves of the Cambodia-Laos-Myanmar Development Fund II (CLMDF II), Singapore-based news portal DealStreetAsia reported on Friday.
It quoted FMO as saying: “While the fund’s investees have shown resilience, capital earmarked for future growth has been depleted to cover working capital and operating expenses during the lockdown. The fund’s follow-on strategy has also been affected.”
It said the capital is expected to shore up the CLMDF II’s 13 portfolio companies during and post-Covid-19.
FMO added: “An increase in commitments would help the fund achieve its value creation objectives and support investees in reaching their initial growth targets.”
The fund reached a first close of $64.5 million in 2015 – FMO committing $10 million – with investments in 13 companies, the majority of which were Cambodian-based, DealStreetAsia said. Four companies in Myanmar and three in Laos also received funding.
Fairly broad range
EMIA CEO Joshua Morris told DealStreetAsia last month that the company has centred on working with investors to undertake further commitments to the second fund’s follow-on reserves.
He said EMIA aims to garner commitments from existing and new limited partners to raise up to $120 million for a new investment vehicle.
The third fund will retain the existing industry-agnostic game plan of investing in Cambodia, Myanmar and Laos, he said.
“We expect to cover a fairly broad range of investment sizes in the new fund while leaving sufficient follow-on reserves to support growth after our initial investment,” Morris said.
EMIA’s $19.65 million first fund invested solely in Cambodia and Laos but subsequently divested from the two countries, he said, adding that it sold its stakes in the Kingdom’s Park Cafe Food and Beverage Co Ltd and AMK Microfinance Institution Plc.
Loan for Acleda Bank
In October 2015, leading Cambodian commercial bank Acleda Bank Plc received a $102 million syndicated loan with five-year tenure, FMO said.
FMO, which also acted as mandated lead arranger and facility agent, provided $15 million along with seven partners, it added.
These are the Opec Fund for International Development (OFID; $15 million), Austrian development bank Oesterreichische Entwicklungsbank AG (OEeB; $15 million) and Agence Francaise de Developpement private-sector financing arm Proparco ($15 million).
The Sri Lanka-based institutions Hatton National Bank Plc and National Development Bank contributed $15 million and $10 million, respectively.
Switzerland-based social impact investor Symbiotics SA and Swedish State-owned development financier and development cooperation actor Swedfund International AB jointly provided $14 million.
Additionally, FMO said, Dutch-based Vivat NV subsidiary Actiam NV provided $3 million via FMO’s fund structure.
“The transaction was launched as a $70 million loan. However, due to the overwhelming market appetite for Acleda Bank, the transaction was upsized to $102 million,” it said.
