Western NIS Enterprise Fund, a regional investor, has announced that it will contribute $30 million to a new fund which will seek to invest in “fast-growing, export-oriented” small and medium-sized businesses with roots in Ukraine and Moldova.
The new fund, which has a target size of $150 million, is known as the Emerging Europe Growth Fund III. Managed by private equity firm Horizon Capital, it has already received commitments of contributions of up to $20 million from the International Finance Corporation and $30 million from the European Bank for Reconstruction and Development. The Overseas Private Investment Corporation, a U.S. government agency which helps American businesses invest in emerging markets, has approved a loan to the fund of up to $37.5 million.
The new fund’s focus on export-oriented companies comes after exports of goods from Ukraine to the European Union jumped by 24.5 percent year-on-year in the first quarter or 2017 to nearly $4 billion, according to Ukraine’s Ministry of Trade and Economic Development. The 28-nation bloc was the top destination for Ukrainian goods during the period.
Emerging Europe Growth Fund III will seek to make investments in the sectors of information technology, light manufacturing, food and agriculture, according to Jaroslawa Johnson, president and CEO at the Western NIS Enterprise Fund.
“The strategy is compelling from our perspective, seeking to capitalize on a surge in exports to the European Union and other countries, investing in companies that derive the largest part of their revenues in hard currency from foreign markets,” Johnson said in a statement.
Horizon Capital currently manages three funds totaling $700 million focused on Ukraine and the region, of which Western NIS Enterprise Fund is one.
Western NIS Enterprise Fund was funded by the U.S. government via the U.S. Agency for International Development when it was established in 1994.
