Central and East Europe-Focused Funds in Market – January 2013

by Stuart Hunter

  • 14 Jan 2013
  • PE

Currently there are 121 Central and East Europe-focused funds in market, collectively seeking €31.9bn in capital commitments, according to Preqin's Funds in Market database. Of these funds in market, 61 have already had at least one interim close, collecting €5.7bn so far.

Of the Central and Eastern Europe-focused funds which explicitly target a country, most target Russia-based investment opportunities, with 10 funds collectively targeting €3.3bn in capital commitments. This represents a fall of 8% in targeted capital since the start of 2012, when 11 primarily Russian-focused funds aimed to collect €3.6bn. The second most popular country for fund managers to raise country specific funds is Turkey, with nine funds in market seeking to obtain €2.4bn in capital commitments. This illustrates a 41% rise in targeted capital compared to the beginning of 2012, when eight funds in market set out to garner €1.7bn. Country specific Russia and Turkey-focused funds in market account for 18% of the total capital targeted by central and eastern European-focused funds in market.

Of the 121 Central and East Europe-focused funds in market, the majority of fund managers are located in Russia, with 22 funds’ aggregate target capital accounting for 27% of the total capital sought within the region. The second largest numbers of fund managers are located within the US, with 17 fund managers’ seeking to collect €4.2bn, while 11 UK-based fund managers aim to raise €2.9bn to invest in the region.

The average target size of the 121 central and eastern European-focused funds in market is €263.6mn, with the largest fund, Russia-China Investment Fund, seeking to raise $4.0bn in capital commitments. The buyout fund is managed by Russian Direct Investment Fund and targets a diverse range of industries including agriculture, clean technology, energy, engineering, timber and transportation. The primary target of the fund is to act as a catalyst for direct investment into Russia, but also plans on investing around 30% of its total capital commitments into China.

The second largest fund in market, AVG CIS Agricultural Opportunities Fund, seeks to raise $1.5bn. AVG CIS Agricultural Opportunities Fund primarily invests in Russia with areas of interest including the purchase and creation of new crop farms, investments in the downstream processing of agricultural products, infrastructure and logistics, as well as creation of a bank of agricultural land. The third largest fund in market, InfraMed Infrastructure, targets €1bn in capital commitments and looks to invest in infrastructure projects throughout the southern and eastern Mediterranean basin regions.

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