Aureos Capital, a private equity fund management company focused on small to mid-sized businesses in emerging markets, has raised USD184m at the final close of the Aureos Latin America
Aureos Capital, a private equity fund management company focused on small to mid-sized businesses in emerging markets, has raised USD184m at the final close of the Aureos Latin America Fund.
ALAF will make investments of between USD2m and USD10m in small to mid-sized businesses in Mexico, Central America and the Andean region, including Colombia and Peru.
Investors in ALAF include international and regional asset managers, pension funds, insurance companies and development finance institutions.
Sev Vettivetpillai (pictured), chief executive officer of Aureos Advisers, says: ‘Considering the recent turbulence in the global economy and with investors reducing their appetite for risk we are delighted with the results of the ALAF fundraising. Whilst Latin America has not been immune from the recent economic downturn, the emergence of a growing middle class makes this a highly attractive investment market.’
ALAF has already made seven investments, including Mexican IT solutions company Grupo MetroNet, Mexican office equipment vendor and leasing company Docuformas, fleet management and leasing companies Analistas de Recursos Globales in Mexico, and Rentandes in Colombia, and most recently Peruvian fashion accessories retailer IasaCorp.
Erik Peterson, the regional managing partner of the Aureos Latin America Fund, says: ‘ALAF’s investments to date have been in companies likely to be well-insulated from the downturn. For example ALAF has made several investments in businesses that provide outsourcing and leasing services. In the current economic climate many companies are looking to cut costs and shore up their balance sheets and are entering into long-term leasing and outsourcing contracts in order to lower their capital expenditure budgets.
‘In addition to benefiting from high quality local expertise on the ground Aureos rarely relies on third party debt financing as part of its investment structure. This puts us in a strong position to invest in companies with capable management teams and strong growth potential ahead of buy-out firms who do rely on debt financing and may no longer be able to secure adequate funding.’
Aureos also manages two other funds in Latin America: a USD21m fund for investment in small enterprises in Central America, the Emerge Central America Growth Fund; and Aureos Central America Fund, a USD36m fund for investment in small and medium-sized enterprises in Central America which is already in divestment mode.
