Project detail - HORIZON CAPITAL GROWTH FUND II, L.P

HORIZON CAPITAL GROWTH FUND II, L.P

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Who is our client

Horizon Capital Growth Fund II, L.P. (the “Fund”, “HCGF II”) is a private equity fund investing in Ukraine-based assets, managed by Horizon Capital. Starting with HCGF II, funds managed by the firm carry the Horizon Capital brand name. FMO has a longstanding relationship with Horizon Capital, having invested in all three of the private equity funds managed by Horizon Capital and established to date (Emerging Europe Growth Fund I, II & III).

Funding objective

The funding objective is to support the first such secondary transaction in Ukraine to provide existing investors, including FMO which made a $20 million commitment to EEGF II in 2008, the opportunity to continue to back the portfolio for a period of up to 5 years plus two one-year extensions. The portfolio continues to be managed by Horizon Capital and benefits from significant additional follow-on capital raised during this process.

Why we fund this project

As a result of the GP-led secondary, FMO has elected to maintain its exposure to the underlying assets and commit a portion of new capital for follow-on investments. Through this reinvestment, FMO continues to support Horizon Capital’s development, to back the introduction of innovative transactions in the markets in which it operates, and to contribute to economic growth in Ukraine.

Environmental and social rationale

Based on the Fund’s existing portfolio, HCGF II has been categorized as Category B in accordance with FMO’s Sustainability Policy. The actual E&S risks vary from investment to investment, but key issues are mainly related to IFC PS 1, 2 and 3. Horizon Capital has dedicated ESG staff and a high quality and well-functioning ESMS in place based on IFC PS, which has been established with support from an external consultant. For all assets, compliance with local regulation and with IFC PS framework is required. FMO continues to engage frequently with Horizon Capital to monitor and provide feedback on the Fund’s E&S performance.

Region
Europe & Central Asia
Country
Ukraine
Sector
Infrastructure, Manufacturing and Services
Signing date
4/22/2021
Total FMO financing
USD 13.90 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B