Archipelago Asia Focus Fund II (AAFF II) is a mid-market, control-driven PE fund that seeks to invest across Southeast Asia, specifically in Indonesia, the Philippines, Malaysia, and Thailand.
The fund seeks to tap buyout or significant control opportunities in three sectors – consumer goods and services, financial services, and industrials and logistics.
As of October 2020, the fund has managed to secure 75% of its $250-million target and is expected to close in the first half of this year, its CEO Jovasky Pang told DealStreetAsia in an earlier interaction.
“By investing in AAFF II, FMO intends to support local entrepreneurs and owners of medium-sized companies through providing capital for growth and operational advice with a goal to enhance these businesses’ growth and performance through active ownership,” FMO said in its disclosure.
The International Finance Corporation, a member of the World Bank Group, has also proposed a $25-million equity investment into Fund II.
Archipelago Capital Partners was founded in 2015 by Pang, along with Kiat Chan, and Eng Khim Lim. Its first fund had a corpus of $75 million.
LPs who committed to Archipelago’s maiden fund were Pavilion Capital, Sofina, Hanwha, and NH – or Nonghyup, National Agricultural Cooperative Federation – according to a Singapore Venture Capital & Equity Association Quarterly July 2020 newsletter.
Archipelago typically invests in companies that it has tracked for over a year, taking into consideration their sustainability, business models, and products. Companies on its radar are those specialising in food packaging, ready-to-eat products, food processing, and ingredients.
In its disclosure, IFC had earlier indicated that Archipelago’s second fund will deploy 40-50% of its corpus in companies operating in the Philippines.
FMO, meanwhile, is focused on supporting sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs.
The bank has an investment portfolio of $10.4 billion, with a 28% exposure to Asia. It focuses on developing markets, covering sectors such as financial institutions, energy, and agribusiness.
FMO’s average ticket size for investment is 15 million euros ($16.7 million) and it invests across equity and debt.