US-based Darby Overseas Investments Limited and Spain headquartered Banco Bilbao Vizcaya Argentaria have formed a strategic partnership, Darby-BBVA Latin American Investors (DBVA). The new vehicle will launch a $250m private equity fund which will invest in a range of sectors in Latin America.
The two companies will commit equal shares to the partnership. Claudio Aranzadi, head of international operations of BBVA's industrial investment group explained: “Our fund will build value in its portfolio through the acquisition of control and shared control stakes in a range of enterprises and, in appropriate situations, it will assume influential minority stakes. The fund's board of directors and its investment committee will have equal representation from the two parent firms. The Investment Committee will draw on the extensive investment expertise of key executives available to both firms.”
Richard H. Frank, chief executive of Darby will serve as the CEO of DBVA and as head of the investment committee. The two companies have worked closely together in recent years in developing the Darby Latin American Mezzanine Fund, which is the region's first vehicle offering subordinated debt financing for corporations and projects, particularly in infrastructure projects.
Commenting on the current investment climate, Frank said: “We believe that this is a good time to seize investment opportunities in Latin America. Many businesses are growing rapidly and need the capital and the expertise that Darby and BBVA can provide. Some of the opportunities that we perceive are not yet sufficiently evident to many international investors who have been influenced by short-term uncertainties in emerging markets that have been partly the result of the spillover impact of volatile US financial markets.”
Julio F. Lastres of Darby and Jaime Salinas of BBVA will head day-to-day operations of the fund in their capacity as managing directors.