Sphinx Private Equity Management, a private equity management company that focuses on investing in medium-sized companies, has announced the launch of a USD100m fund that targets distre
Sphinx Private Equity Management, a private equity management company that focuses on investing in medium-sized companies, has announced the launch of a USD100m fund that targets distressed assets in Egypt.
The European Investment Bank and the International Finance Corporation are each investing USD17m in the fund alongside Citadel Capital, a regional private equity firm, whose 19 opportunity-specific funds control investments worth more than USD8.3bn in industries ranging from energy and food to transportation and specialty retail.
EIB and IFC, which both played prominent roles in the development and creation of the fund, will be acting as anchor investors.
Citadel Capital is sponsoring the Sphinx Turnaround Fund with a cash investment of USD10m. The Geneva-based Swiss Investment Fund for Emerging Markets is in the process of finalizing its commitment of USD7.5m to the fund.
"The fact that we were able to close on this fund now, amidst such turbulent economic conditions, is a clear indication that institutional investors continue to view Egypt as an attractive investment opportunity. With a fund that mainly targets distressed assets and turnaround situations we are providing timely access to finance and managerial expertise during one of the worst credit crunches in recent history," says Marianne Ghali, managing director of Sphinx Egypt and the Sphinx Turnaround Fund.
Rashad Kaldany, IFC vice president for the Middle East and North Africa, says: "Private equity funds can play an important role in providing capital emerging markets companies need to survive and grow. During this time of economic crisis, IFC is particularly pleased to support a fund that invests in distressed or defaulting enterprises to make them viable again. We look forward to promoting similar funds in the Middle East through our partnership with Citadel Capital."
The fund will be investing in Egypt-based small and medium-sized enterprises that are distressed, in default, or in need of restructuring. In some instances, the fund may also consider investing in companies that are in need of expansion capital to pursue specific growth opportunities.
Projects already in the pipeline cover seven sectors, including geo-textiles, automotive assembly, cosmetics, logistics, food processing, specialty glass and pharmaceuticals.
Sphinx Egypt also manages the portfolio of Grandview, Citadel Capital’s platform company for mid-cap investments, and has over USD230m in assets under management.
