Malaysia’s COPE Private Equity has launched an equity investment program to provide capital to domestic businesses hurting in the wake of the COVID-19 outbreak.
The program, dubbed Bridge Over Troubled Water, or BOW, will provide 20-40 million ringgit ($4.6-9.2 million) to Malaysian companies looking for capital. The program, which will provide equity and quasi-equity financing, will not invest in startups, project financing, commodities, properties, and non-shariah businesses, COPE said.
The fund will be supported by COPE’s institutional investors, said founder Azam Azman.
“Many businesses shut for a period of one month will require significant capital to resume operations and as private equity investors, we expect a busy end to 2020,” said Azman.
The total corpus for BOW is about 180 million ringgit ($41.4 million), DealStreetAsia has learnt.
Other than providing capital, COPE will work with the selected entrepreneurs on a three-year strategic plan and assist them in strengthening their middle management team and HR and IT processes.
COPE said it expects to support companies, especially those that satisfy important consumer needs, in the areas of energy, healthcare, education, food production, and in peripheral areas such as medical devices and engineering maintenance services.
COPE intends to keep its investment strategy unchanged after the COVID-19 pandemic is over, its founder said, but will stress sustainability and strong cashflow management among its portfolio companies.
“Given our past experience during the downturns in 1997 and 2008, a laser focus on cash flow is important to ensure portfolio companies survive the crisis,” Azman added.
Established in 2005, COPE is a middle-market PE firm with 600 million ringgit of assets under management. The company focuses on Malaysian companies that are based on Shariah, or Islamic Law.
According to its website, COPE’s portfolio includes aluminium and zinc die casting business STX Precision Group, fruit retailer MBG Holdings, school uniforms maker and distributor My Sutera Holdings, IoT company MDT Innovations and laundromat chain Cleanpro.