SigmaBleyzer, the US fund management company based in Ukraine, is planning to launch a $100m private equity fund investing in the expanding South East European economies.
SigmaBleyzer chief executive Michael Bleyzer said that the fund would target opportunities in the region’s accession states, particularly Bulgaria and Romania, which are scheduled to join the European Union in 2007. “It is probably the most interesting area right now in Europe. It is just the right time, and investment is all about timing,” said Bleyzer in an interview with Reuters.
The fund, which will be raised in two $50m tranches, will target high-tech investments in sectors including telecoms and software development. Other areas of interest for the fund include tourism, processing industries and those related to agriculture. In addition to investing in Bulgaria and Romania, the fund will also look for investment opportunities in Serbia, Bosnia-Herzegovina, Macedonia and Ukraine.
The fund, which plans to begin investing at the start of 2004, will look to invest between $1m to $5m in target companies, and will take majority positions in undervalued growth companies. Bleyzer expects the fund to be fully invested within two years.
The new fund, which will be based in Sofia, will build on SigmaBleyzer's experience in Ukraine, where it has already invested three funds with over $100m of capital since 1996 and built a portfolio of more than 60 companies.
“We are not necessarily looking for the best companies. We are looking for the companies with the best potential that are currently undervalued, so that we can buy them then come in, restructure them and create value,” said Bleyzer.
The announcement of the fund comes only weeks after Greek-based Global Finance revealed details of a link-up with the European Bank for Reconstruction and Development (EBRD) to raise a E20m fund, also to focus on Bulgaria and Romania. The Global Bulgaria and Romania Growth Fund will make equity investments of around E800,000 in growth-oriented SMEs.