ADB will provide an equity investment of up to $20 million in VI (Vietnam Investments) Fund III, L.P. to make equity and equity-linked investments in middle-market companies and small and medium-sized enterprises primarily in Viet Nam. Such investments in Cambodia, the Lao People’s Democratic Republic, and Myanmar are also envisaged.
Vietnam Investments Group
$20 million equity investment
- The fund is aimed at making equity and equity-linked investments in middle-market companies and small and medium-sized enterprises (SMEs), primarily in Viet Nam.
- Similar investments in Cambodia, Lao People’s Democratic Republic (Lao PDR), and Myanmar are also envisaged.
- The investment is expected to sustain the development of capital markets through private equity investments.
- It will improve liquidity and demonstrate the viability of private equity investment for larger and institutional investors.
- In addition, the investment will enhance job creation in middle-market companies and SMEs through strategic and operational guidance from the fund manager, and injections of capital to allow growth in local businesses.
ADB’s value addition
- Promote the growth of private equity funds in Cambodia, Lao PDR, Myanmar, and Viet Nam, which still struggle to raise capital, particularly from foreign investors. ADB’s participation will send a positive signal to the markets and highlight the capital needs of privately owned middle-market companies and SMEs in these countries.
- Encourage the general partner to ensure that its investee companies comply with the highest environment and social safeguards. ADB, as a member of the advisory committee, will assist in providing oversight of the fund’s governance.
15 November 2016
This case study is originally published in Asian Development Bank Private Sector Operations, a brochure describing the work of ADB's Private Sector Operations Department, its main goal, sector focus, portfolios, and case studies on projects approved in 2016.