Equity can be crucial for a business’s growth and expansion – but is often unaccessible to companies in developing countries. As an equity investment partner, FMO brings more to the table than financing alone.
Committed to the future
Growing businesses need knowledgeable investors that not only provide necessary funding, but also share a long-term vision. FMO provides equity with a goal that reaches beyond the businesses to the benefit of their economies and society at large. And because we provide such scarce, high-risk finance, FMO looks for clients that also share a vision of long-term impact.
Successful investment approach
We build on our successful strategy of investing in private equity funds and making co-investments alongside these funds. We seek leadership in our focus sectors Financial Institutions and Energy. Our focus and network in these sectors translates into a substantial deal flow of visible and often innovative deals.
Through a top-down market approach we identify and pursue strategic deals with the most promising players in a sector. From the very start, FMO focuses on a clear exit strategy as part of negotiations and structure – usually taking a minority interest in a project’s equity to pave the way for more autonomous investment paths.
An anchor investor
In our fund investing activities, we cement our leadership by supporting not only fund managers with a positive track record, but also first time fund managers as anchor investor in frontier market funds or funds in FMO's focus sectors. These fund managers can benefit from FMO's substantial network and our knowledge of best practices in emerging markets private equity.
In addition to conducting a thorough business and financial due diligence, we also look for clients willing to make solid social, economic and governance conditions part of their business model, if these are not already in place.
FMO can answer private equity needs through:
- Investment in private equity or mezzanine funds
- Co-investments with our investee funds
- Direct equity investments in financial institutions or energy companies or projects
- Mezzanine transactions combining elements of equity and debt
Our participation often acts as a catalyst – attracting interest from other suitable investors who would otherwise avoid what are still considered higher-risk projects.
By supporting first time fund managers as an anchor investor, we pave the way for other investors to join later on. In our direct investments, our contribution to the investee companies' capital base allows these companies to access debt finance from local or international banks.