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FMO and Fairview introduce fund of funds for Africa

Thursday 16 August 2012 11:15

New FMO Fairview Africa Fund will provide institutional investors with new opportunities to invest in high growth markets in Africa

Dutch development bank, FMO, in partnership with U.S. fund-of-funds manager Fairview Capital Partners, introduces a fund-of-funds for Africa. This new fund provides institutional investors with access to attractive and diversified private equity exposure in the high growth markets of Africa. It builds on the track record and more than 15 years experience of FMO in making private equity investments in Africa and the proven capacity of Fairview in offering innovative fund-of-fund solutions to institutional clients. The fund will apply an active hands-on investment approach with best practice environmental, social and governance (ESG) standards and criteria.

The Netherlands Development Finance Company (hereinafter “FMO”) and Fairview Capital Partners (“Fairview”) have reached agreement to establish a Fund, which will be managed by FMO and Fairview, to invest in promising private equity funds in Africa. The Fund will selectively make co-investments alongside its investee funds. This new fund-of-funds will have a target size of USD 200 million, with a first close target of USD 100 million (of which 50% has already been committed by FMO). Africa offers an attractive private equity environment, with a growing middle class seeking better quality products and infrastructure, which provides ample investment opportunities. In addition, relatively unexplored markets and limited competition lead to proprietary transactions and attractive valuations; high growth and minimal leverage of companies mitigate higher ‘perceived’ risk; and the legal environment and political stability have improved considerably. Professional fund managers with track records exist and, as the African opportunity is increasingly recognized and pursued by investors, additional funds with talented managers are being established.

A long term view, sharp manager selection skills and a value-add investment approach remain crucial, for which an experienced investment advisor is indispensable. Yvonne Bakkum, Director Private Equity at FMO, comments: “Based on our longstanding and positive experience in Africa, we are very excited about the prospect of bringing qualified institutional investors along. Indeed, catalyzing commercial investors is one of FMO’s core strategic objectives. Apart from FMO’s own commitment, we believe this fund will hold significant appeal to U.S., European, and African institutional investors. This is truly ground breaking as many African countries recently broadened pension regulations allowing pension funds to invest (more) in alternative investments in and outside their own countries. The entry of local investors will further boost the vibrant private equity sector in the region, ultimately enabling more ambitious entrepreneurs to finance sustainable growth of their companies”.

About FMO
FMO (the Netherlands Development Finance Company) is the Dutch development bank. FMO supports sustainable private sector growth in developing and emerging markets by investing in ambitious entrepreneurs. FMO believes a strong private sector leads to economic and social development, empowering people to use their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With an investment portfolio of EUR 6.2 billion, FMO is one of the largest European bilateral private sector development banks.

Press contact:Paul Hartogsveld

Communications Officer (PR)
T +31 70 314 9924
M +31 6 39447288
E p.hartogsveld@fmo.nl

About Fairview Capital Partners
Fairview Capital Partners is a US-based private equity fund-of-funds manager established in 1994 and manages 18 funds-of-funds with an aggregate capitalization of $3.3 billion. Fairview’s clients include public and corporate pension plans, endowments and other institutional investors. Fairview has a highly skilled investment and finance team that has experience investing in established private equity partnerships as well as in younger partnerships, many of which were newly formed at the time of the firm’s initial investment, and several of which have grown to become leaders in their area of focus. Fairview has also built a robust finance and accounting infrastructure for institutional quality monitoring and reporting.

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