Darby expands into Asia

Darby Overseas Investments has acquired Prudential Financial’s $246m Asian mezzanine fund.

Darby Overseas Investments, the US-based private emerging markets investment firm which focuses on South American emerging markets, has announced the acquisition of Prumerica Asia Infrastructure Investors (PAII) from an affiliate of Prudential Financial. The acquisition by Darby represents the firm’s first move into the Asian market.

PAII, which is to be renamed Darby Asia Investors, is the Hong Kong-based manager of the $246m Asian Infrastructure Mezzanine Capital Fund (AIMCF). Financial terms of the transaction were not disclosed.

Launched in 1998, AIMCF provides mezzanine capital for the infrastructure industry in the emerging market countries of Asia. Major investors in this fund include The Prudential Insurance Company of America, a number of Japanese insurance companies, led by Nippon Life, and pension funds from Asia and the United States. The Asian Development Bank is a core investor in the fund and played a key role in launching AIMCF.

Speaking at the company’s Washington press conference, Richard Frank, Darby CEO, said he thought that the timing was right for an expansion into Asia’s emerging markets. “We believe it is an opportune time to have fresh capital available and AIMCF will hopefully find excellent investment opportunities in the months ahead. Our move into Asia provides Darby with a greater base of operations, increased asset diversification and an expanded list of first class investors.” 

Joseph Ferrigno, who will become president and chief executive of business in Hong Kong said that current valuations in Asia were very attractive, particularly in Indonesia, Korea and the Philippines, which are starting to re-emerge from a lengthy period of instability. He added that the AIMCF fund has around $100m still to invest and that the company was looking to make investments in the coming months.

Darby is a private emerging markets investment firm established by Nicholas Brady, former Secretary of the US Treasury. Darby currently sponsors and manages funds for institutional investors and high net worth individuals that invest in Latin American private equity, emerging markets mezzanine finance transactions (including the new Asian operations), and global emerging markets and high yield fixed income securities.