30th September 2011
Further to the signature of five guarantee agreements with Bulgarian banks in July 2011 under the Joint European Resources for Micro to Medium Enterprises (JEREMIE) initiative, EIF progressed with the selection of financial intermediaries under the calls for expressions of interest for the equity products and is currently negotiating a potential commitment with the following private equity fund managers:
Risk Capital Fund
Neveq Capital Partners – an established team in the Bulgarian market, with an investment experience through NEVEQ I, a previous fund of similar size and strategy, raised in 2007.
The new fund has a target size of at least EUR 30m and will focus on seed, start-ups and late stage transactions in Bulgarian technology companies. Investments into individual portfolio companies will typically be in the range of EUR 0.5m – EUR 1.5m per annum.
Growth Capital Fund
Axxess Capital – a new company to manage the JEREMIE growth fund will be set-up by Axxess, one of the largest and most experienced private equity teams consistently focusing on the South-Eastern European lower mid-market. Axxess is headquartered in Bucharest (Romania) and has an office in Sofia (Bulgaria). Since 1994 Axxess has raised and managed three multi-country private equity funds: Romanian American Enterprise Fund established in 1994, the 2005 Balkan Accession Fund and Emerging Europe Accession Fund raised in 2010.
The growth capital fund has a target size of EUR 60m and will provide growth/expansion capital to Bulgarian lower mid-market companies, across a wide range of sectors.
Bulgaria Mezzanine Capital – a joint venture between Growth Capital Partners AG (GCP) and Rosslyn Capital Partners (RCP). GCP was founded by principles of Mezzanine Management Central Europe (MMCE), the leading mezzanine fund manager in the CEE region created in 2000. MMCE has successfully raised and managed three multi-country mezzanine funds since 2003 focusing on CEE: AMC I in 2003, AMC II in 2007 and AMC III in 2010. RCP was established in 2002 and since then has raised and/or managed five equity funds with more than 30 direct investments, mainly in Bulgaria.
The mezzanine fund with a target size of EUR 60m will provide mezzanine financing for growth expansion, external growth and capital restructurings in the Bulgarian lower mid-market, across a wide range of sectors. The targeted investment size per transaction is EUR 2m – 5m.
The three fund managers have been retained out of the twenty nine applications received under the aforementioned calls for expression of interest. The EIF is in the process of legal negotiation with the intermediaries and will be able to confirm their selection once an agreement has been reached on all the details.
The fund managers have also commenced the process of raising private contributions as well as structuring fund vehicles.
It is expected that the first funds will start the investment process in 2012.