Malaysia-based private equity firm Navis Capital Partners is in the midst of setting up a Malaysia-focused fund, with a target corpus of MYR750 million ($184.66 million), if it can seal in a good anchor investor.
Partner Raj Ayadurai said, the hard cap of MYR750 million is only if the firm is able to get a solid investor on board, “otherwise, we will target to close the fund at around MYR400 million to MYR600 million ($98.48 million to $147.72 million)”.
The fund will aim for final close towards the end of this year, and is Navis’ first Malaysia-focused fund.
Ayadurai said, the move to set up a fund targeted at the Malaysian market, came from the firm’s experience working with Ekuinas as an outsourced partner. Navis was one of the partners for national private equity management firm, Ekuinas‘ Malaysia Growth Opportunities Fund I (MGO1), which closed with MYR300 million in capital commitments in 2011.
“We won’t be taking controlling stakes in the investments we make under this (Malaysian) fund, as we have learned through as Ekuinas’ outsourced partners for MGO1, that this (strategy) works well (in this market),” he told DEALSTREETASIA at the sidelines of the recent Asian Private Equity Tech Conference.
“Under our main fund, we typically take controlling stakes in deals the size of $50 million or more; that’s just too big for Malaysia,” he said.
The LPs in the fund will be different from those in Navis’ main fund. “These will be Malaysia-based LPs or institutions with MYR to use,” he said.
Speaking on the main fund, Navis Asia Fund VII, Ayadurai said the capital has been half utilised.
“I don’t think we will be raising until the end of next year or after that,” he said of any more fundraising for its Asia fund.
Navis Asia Fund VII and its parallel Islamic Fund closed with over $1.5 billion in capital commitments in 2014.
Navis is also continuing its divestments of pre-Global Financial Crisis deals.
In an interview early in 2015, Navis co-managing partner Nicholas Bloy told DEALSTREETASIA that the firm aims to make $2 billion worth of exits, primarily realising the investments held before 2009 from the Navis Asia Fund V.
This fund had closed with over $1 billion in capital commitments in 2007. Ayadurai said, the firm has made capital gains on Fund V, although he did not elaborate.
Last year, Navis made exits in Hui Lau Shan, ECO Industrial Environmental Engineering, Blueprint Oriental Containers, WSI Hong Kong and PeopleBank Australia.
This year, it has so far exited Guardian Learning Group and Golden Foods Siam.
According to its website, Navis has made over 60 investments since 2000. Of those, over 20 have been follow-on acquisitions, yielding consistent return in excess of the top quartile benchmarks in the industry.
As of end the last quarter in 2015, Navis Asia Funds’ realised track record is a gross IRR of 22 per cent and money multiple of 2.4 times, it said.