Galena Asset Management, which offers investment opportunities through specialised commodity funds, has closed the first tranche of its Private Equity Resource Fund at USD275m.
The fund will invest in equity and debt of small to medium-sized metals and mining companies in development or production stages.
Galena Asset Management will leverage parent company Trafigura’s expertise and track record in investing in junior mining companies.
“Access to a global network able to source opportunities and the ability to rely on solid in-house investment, technical and financial expertise represents a great advantage for investors in the new fund,” says Maximilian Tomei, head of marketing, Galena Asset Management. “We expect additional closes over 2013 and are aiming for a USD600m hard close by December 2013.”
The fund will be managed by Jesus Fernandez, who has led Trafigura’s mining investment team since 2005. The team has successfully invested in five mining companies for Trafigura, of which four have been exited, producing an average multiple of 3.9 times the original investment. The same team will move to Galena Asset Management and be dedicated to managing the new fund which will become Trafigura’s exclusive mining investment vehicle.
“Small to medium-sized mining companies are finding it harder to access funding in the current economic climate,” says Fernandez. “The new fund provides a mechanism for bridging investor appetite for commodity-linked assets and companies that require capital at a reasonable cost.”
The fund will invest in geographically diverse assets, coal mining as well as base, ferrous and precious metals. Fund appointees will assist in the management and strategic direction of companies invested in.
