Romanian Capital Advisors (RCA), the company managing the Romanian American Enterprise Fund (RAEF) – one of Romania’s main investment funds, is planning to launch a new investment fund this year, with a capitalisation revolving around 50 million euros, Horia Manda, managing partner with RCA and senior vice president of RAEF told Ziarul Financiar. In the first stage, the fund will be dedicated to Romania and Bulgaria, but will then gradually expand in the Balkans, depending on the arising opportunities.
Part of the money needed for the new fund’s capitalisation will come from RAEF, which has several tens of millions of euros available, after having sold the main stake (80%) it held in Banca Romaneasca (Romanian Bank) to the National Bank of Greece, last year.
“We are planning to use some of the money we got for the stake in Banca Romaneasca in order to help raise the new fund. There are also some investors that have voiced interest, and even pledged to put money in the fund. The first money-raising stage will stop at 25 million euros, with the second phase to push the fund’s value up to 50 million euros,” Manda said.
The fund will use more flexible instruments, but its strategy will be basically in line with the private equity funds: identifying companies with growth potential (either organic or by acquisitions) and performing management, granting financial support to these companies by means of capital increases and subordinate loans and then selling them to a strategic investor.
“We are mainly interested in companies operating in sectors such as financial services, retail, FMCG (fast moving consumer goods), distribution, logistics or health services. However, we are not ruling anything out,” Horia Manda stated.
The RCA initiative to raise a regional fund is part of a broader perspective, as many European managing companies have lately started or even completed similar processes, in a bid to seize the opportunities provided by the second European Union enlargement wave that Romania is part of.
“The businesses in Romania and Bulgaria, and gradually in other Balkan countries, will surge once the European Union accession date nears, irrespective of the exact timeline. In our opinion, services, especially financial services, will post the biggest growth,” Manda claims.
RCA, through RAEF, has already been paying special attention to financial services in the past two years. In 2002, RAEF acquired the main stake (80%) in Motoractive, the biggest independent leasing company, from another two investment funds. Last year, RAEF also became the main shareholder in Domenia Credit, one of the first Romanian mortgage companies, and in Certinvest, the mutual fund manager.
Furthermore, RAEF owns the majority stake in RALFI (Romanian American Leasing and Finance), a consumer finance company.
“Financial support for the companies bought in the past few years is the second use we shall give the money obtained from the sale of Banca Romaneasca,” Manda says. laurentiu.ispir@zf.ro