BRAZIL RISING

The Latin American nation is seeing a positive impact from US rating agency Standard & Poor's officially changing its status to investment grade.

MEASURABLE IMPACT

S&P's upgrade of Brazil on 30 April created an immediate rise in stock prices throughout the country that appears to be no blip, as the average share price has subsequently stabilised at a higher level.
29 April: 83.93 15 May: 96.83
30 April: 90.32 16 May: 99.54
1 May: 91.82 19 May: 100.03
2 May: 93.4 20 May: 100.47
5 May: 93.85 21 May: 98.75
6 May: 94.4 22 May: 97.48
7 May: 91.42 23 May: 97.45
8 May: 92.4 27 May: 95.76
9 May: 92.88 28 May: 99.21
12 May: 94.71 29 May: 99.24
13 May: 95.02 30 May: 98.43
14 May: 94.25

EMP FORCED TO SELL BOLIVIAN ENERGY INVESTMENT
EMP Global's AIG-GE Capital Latin America Infrastructure Fund (LAIF) was forced by the Bolivian Government to fully divest its 9.7 percent shareholding in Bolivian natural gas transportation company Transredes. Government-owned energy company Yacimientos Petroliferos Fiscales Bolivianos (YPFB) purchased the stake for $46.6 million (€29.6 million). “[LAIF] exited at a profit which was a very good outcome for investors given the current political and macroeconomic circumstances in the country,” said a source familiar with the transaction. LAIF made its original investment in Transredes in 2000. The 2006 Nationalisation Supreme Decree, issued by Bolivian President Evo Morales, required that YPFB assume control of all Bolivian oil and gas companies.

BRAZIL'S SOVEREIGN FUND OBJECTIVES UNCLEAR
Brazil's $20 billion (€13 billion) sovereign wealth fund, proposed in May by the country's Ministry of Finance, may not be the active alternatives investor many other sovereign wealth funds have become. Many of the Brazil fund's “objectives explicitly state politically related motives, more [like the] philosophy of a development bank”, Mauricio Folkerts, partner at Brazilian private equity firm NSG Capital told Private Equity International. The Ministry of Finance has outlined a number of broad objectives for the fund including: supporting projects of “strategic interest” to Brazil, financing the international expansion of Brazilian companies, improving the returns of Government-owned financial assets, creating additional Government savings, absorbing fluctuations in economic cycles and countering the appreciation of Brazil's currency.

JER PARTNERS APPOINTS RISK MANAGEMENT HEAD
JER Partners, the private equity arm of real estate investment firm J.E. Robert Companies, has appointed Ariel Amavizca head of risk management for Latin America. Amavizca, based in Mexico City, will be responsible for structuring, analysing and managing risk aspects for all JER investments made in Latin America. His initial focus will be on investments in commercial and residential real estate. Amavizca was previously chief investment officer of private equity real estate fund MIRA Companies, an affiliate of the Black Creek Group. JER has managed a total of nine private equity funds with $4.7 billion (€3 billion) in equity capital commitments in North America, Europe and Latin America.

AUREOS COMMITS TO MEXICAN TRANSPORT, COSTA RICAN TOURISM
Aureos Capital's Latin America Fund has acquired a majority stake in Mexican transportation leasing company Analistas de Recursos Globales for $5 million (€3.2 million). Analistas de Recursos Globales offers transportation leases and fleet management services to small- and medium-sized Mexican companies which have difficulty obtaining leasing contracts from commercial banks. Analistas de Recursos Globales is the second investment out of Aureos's Latin America Fund since inception in December 2007. The fund, targeting $300 million, held a first close on $140 million (€94 million) in January and is in the process of finalising its second close. It is expected to hold its final close in 2008, and makes investments of between $2 million and $10 million in Mexico, Central America and the Andean region.

Separately, Aureos Capital's Emerge Central America Growth Fund (EMERGE) has acquired a 49 percent stake in Costa Rican sustainable tourism company Horizontes. The investment was made as part of a management buyout of the company. Horizontes organises tourist activities characterised by their low impact on the natural environment and local culture. The is the second investment made by EMERGE, which targets small- and mediumsized enterprises in Panama, Nicaragua, El Salvador, Guatemala, Honduras, Costa Rica, Belize and the Dominican Republic. Aureos was selected by the Inter-American Development Bank to manage EMERGE's $21 million in 2006.

IGNIA SOCIAL VENTURE FUND CLOSES ON $20.6M
IGNIA, a philanthropic venture capital investment firm based in Monterrey, Mexico, has held a first close on $20.6 million (€13.3 million) for its debut venture fund. Fund I, targeting $50 million to $75 million, is expected to hold a second close by the end of the summer. Fund I will focus on serving the needs of the low income population in Latin America by developing commercially viable, entrepreneurial businesses in the healthcare, education, housing, nutrition and basic utilities sectors. Investments will total $2 million to $10 million over the life of a portfolio company. Initial investments will be as small as $500,000.