International Finance Corporation (IFC), a member of the World Bank Group, is considering a $15-million investment in the second impact fund of UOB Venture Management (UOBVM), the private equity arm of Singapore-based United Overseas Bank (UOB).
The fund – Asia Impact Investment Fund II (AIIF II) – will invest in companies in China and Southeast Asia, primarily in the sectors of agriculture, education, healthcare, housing, sanitation, water, transportation, clean energy, and financial services, IFC said in a disclosure.
It will take minority stakes in companies with equity investments in the range of $1-15 million per deal.
AIIF II, which has a target corpus of $100 million, raised more than $60 million at its first close in December, securing commitments from institutional and accredited investors including UOB, global family offices, and high-net-worth individuals.
IFC said its proposed investment will not exceed 20 per cent of the fund’s total commitments once it completes fundraising this year.
“IFC’s investment is expected to help the fund in reaching its final close in a challenging fundraising environment,” the Washington-based institution said.
UOBVM closed its $55 million AIIF I in 2016 and has made about 10 investments across China, Indonesia, Myanmar, the Philippines, and Vietnam from the fund. These include names like Indonesian firms Ruangguru (edtech) and Halodoc (healthtech), as well as Chinese agritech firm Zhejiang Lanmei Agriculture Co.
Fund II continues to see UOBVM partnering with Credit Suisse as it did for its first fund.
“As testament to the success of the first fund, many of our existing AIIF I investors have re-committed to this new fund, reflecting strong interest to invest in proven solutions that can address the social challenges in Asia while achieving quality financial returns,” Joost Bilkes, head of Sustainability Strategy, Advisory, and Finance, Asia Pacific at Credit Suisse, earlier said.
As of December 2020, UOBVM manages $1.4 billion of assets. Apart from its impact funds, it has raised four other China-ASEAN investment funds since 2004, with its fourth and most recent fund closing at $300 million in 2019. The portfolio companies from those funds include Indonesian ride-hailing mammoth Gojek, and Thai remittance startup Lightnet.
UOB Venture Management is an established middle-market manager with over 15 years of experience investing in SMEs in Southeast Asia and China. The UOBVM team is led by Seah Kian Wee, Mark Yeo Wee Tiong, Thng Tien Tat, and Clarissa Loh Su Hui.