Abraaj partners local group to raise $50m Palestine fund

The MENA-focused firm and the Palestine Investment Fund, an entity that invests on behalf of Palestinians, have provided a $15m anchor commitment to a fund that will invest in Palestinian SMEs.

Dubai-based private equity firm Abraaj Capital has teamed with the the Palestine Investment Fund (PIF) to raise a $50 million private equity fund that will invest in small- to medium enterprises in Palestine.

Established in 2000, PIF manages $800 million in assets and invests in sectors including energy, telecoms and real estate. Its main objective, according to its website, is “to safeguard and consolidate the Palestinian people’s investments and property, both in Palestine and abroad”.

Abraaj and PIF have jointly sponsored the fund with a combined $15 million, on which it has held a first close, according to an Abraaj statement.

The fund will make between 20 and 25 investments over four years in small- and medium-sized enterprises (SME) across a range of sectors and maturity stages, the statement noted. 

It will be managed by Riyada Enterprise Development, an SME-focused investment platform that Abraaj acquired in November via its purchase of Riyada Ventures. Jordan-based Riyada plans to raise a $700 million regional SME fund, to which Abraaj has committed $50 million.

Several senior Abraaj professionals have already moved over to Riyada, which plans to establish a presence in Ramallah.

Since inception in 2002, Abraaj has made more than 36 investments in 11 countries and has recorded 21 exits. Currently, the firm is in the market for Abraaj Buyout Fund IV, which is targeting commitments of $4 billion and has seen a first close on $2.6 billion.