AIG closes Central and Eastern Europe-focused fund

The global private equity firm has expanded its emerging markets reach with the close of its €523m New Europe Fund II.

AIG Capital Partners has closed AIG New Europe Fund II at €523 million ($695 million).

The fund will invest in companies based in or operating in Central and Eastern European countries, including Poland, the Czech Republic, Slovakia, Hungary, Romania and Bulgaria. “The [New Europe Fund II] portfolio team is focused on capitalising on the favorable economic, legal and political conditions in [Central and Eastern Europe], with its strong long-term GDP growth outlook, increased domestic consumer demand and a shift in the manufacturing base from Western Europe,” the firm said in a statement.

Pierre Mellinger, an AIG Capital Partners managing director, will be the fund’s chief executive officer. His Warsaw-based team will have additional offices in Bucharest and Budapest.

“This local network optimises deal sourcing, facilitates the execution of investments and greatly supports the value creation in those companies,” David Yeung, the president and chief executive officer of AIG Capital Partners, said in the statement. “As with many of our private equity funds, our investment teams are culturally connected and speak the languages of the local companies in which we invest.”

This fund is the firm’s second for the region. Its predecessor, AIG New Europe Fund, closed in 1999 and invested $321 million.

AIG Capital Partners is a subsidiary of global investment management company AIG Global Investment Group (AIGGIG), which has about $563 billion in assets under management. In addition to  private equity, AIGGIG focuses on equity, fixed income, hedge funds and real estate.