Philippines’ Navegar beats volcanic, pandemic chaos to reach final close

A one-two punch of the Taal volcano eruption and covid-19 put paid to an in-person AGM, where the firm had expected to finalise the due diligence process.

Navegar, a Philippines-focused private equity firm, has overcome volcanic and pandemic disruption to hold a final close on its sophomore fund.

Niklas Amundsson – a Hong Kong-based partner at Monument Group, which served as placement agent to the fund – told Private Equity International that the Manila-headquartered firm had closed Navegar II on $197 million in June against a $150 million target and a $200 million hard-cap.

He said Navegar launched Fund II in March 2019 and held a first close in June of that year, noting that the firm stopped investor meetings in September.

“We could have held a final close six months ago,” Amundsson said. “The [Taal] volcanic eruption happened two days before Navegar’s AGM in January, which was where we’d planned to do the final due diligence sessions. We rescheduled a follow-up session for March, but covid-19 threw a spanner in the works.”

Some new investors committed during the pandemic, Amundsson said. Existing LPs, including the International Finance Corporation, accounted for around $90 million of commitments. Some 46 percent was committed by European institutions, 38 percent came from Asia and 15 percent from the US.

According to its website, Navegar pursues minority growth and control buyouts across the consumer and business services sectors in the Philippines. Its portfolio includes casual dining operator The Bistro Group, which owns TGI Friday’s, Denny’s and Hard Rock Café, and health maintenance organisation Intellicare.

Fund II has completed two investments, according to a Navegar statement about the close.

Amundsson said the $120 million 2013-vintage Fund I had acquired six assets, of which two have been exited. These included the 2018 sale of outsourcing business TaskUs to Blackstone for a reported $250 million.

The Philippines had attracted big bucks prior to the pandemic. KKR invested 35.3 billion Philippine pesos ($686 million; €619 million) into Manila-based Metro Pacific Hospitals last year. The buyout giant also acquired a $192 million stake in power producer First Gen last month.

Warburg Pincus signed its first deal in the country last year with a $250 million investment in broadband provider Converge, which is reportedly gearing up for a $700 million listing in 2020.