Dubai: Global Investment House (GIH), which manages $1.1 billion in three private equity funds, is coming up with its first buyout fund shortly, according to a Money Works report.
Global has also lined up at least three mutual funds in the next two months.
Called the Global Buyout Fund, the buyout private equity fund will have separate Islamic and traditional structures. The Islamic Buyout Fund will be registered in Bahrain and will raise $500 million, while the traditional buyout fund will be registered at Cayman Islands. It will raise $1.5 billion.
Shailesh Dash, senior vice-president and head of strategic investment group at Global, said that with the equity markets correcting in the recent months, valuations of listed companies have come down. Since valuation of listed companies has an impact on the valuation of unlisted companies for acquisition purposes, the times are ripe to launch the Buyout Fund, he added.
The fund, which will have general partner limited partner structure, will also take stake in regional companies expanding their operations outside the region, he added.
Dash said that the fund's initial drawdown will be 25 per cent of the committed capital from investors, while the rest will be based on call as and when investment opportunities come.
The fund will have an investment period of three years and life of seven years, renewable every year after seven years for three years.
"The fund will be marketed internationally as well. We are in an advanced stage of discussions with a placement agents in Europe and Asia. We are also in discussion with institutions in Europe and Asia invest in the fund," he said. Global manages $1.1 billion in three private equity funds, including an Islamic fund. Its two pre-IPO funds have together committed almost $700 million in 35 portfolio companies in the last 15 months.
Dash said that the investments have more than doubled to $1.5 billion.
"Nearly 35 per cent of our investments from our pre-IPO funds are in Saudi Arabia, with 20 per cent each in Kuwait and the UAE and 18 per cent in Kuwait. We are now in the process of concluding two large investments of between $75 and $80 million each in two family-held companies in Saudi Arabia," he said.
Global is also set to launch three mutual funds targeting investments in the Middle East and North African (Mena) markets. Talal F. Samhouri, head of Mena asset management at Global, said funds will be launched targeting Jordan and Egypt soon.
