Malaysia’s Ekuinas to back five local PE managers
Ekuinas, a private equity investor backed by the Malaysian government, will make LP commitments to funds raised by five local PE firms. Four of the five – Tael Parnters, RM Capital Partners, Tuas Capital Partners and CMS Opus Private Equity – will receive MYR240 million ($72.2 million) in seed capital from Ekuinas in addition to MYR133 million they have already received from private investors.
This is the second tranche of the Malaysian group's capital outsourcing program, which will see MYR925 million allocated to third-party managers. The fifth GP is Asiasons, selected as a replacement manager for the first tranche.
A total of MYR640 million has now been committed across two tranches. The third tranche will be allocated in 2015-2016.
"Ekuinas made a deliberate decision to focus on a more developmental role for its Tranche II Outsourced Programme," said Raja Tan Sri Dato' Seri Arshad Raja Tun Uda, chairman of Ekuinas. "This means allocating capital to capable Bumiputera and Malaysian PE firms with a view of developing them to help broaden the reach of traditional private equity as an alternative provider of capital to high growth potential local companies."
The selected GPs will primarily target minority growth capital investments of MYR10-30 million. Ekuinas requires that 70% of its commitment to each fund must go to Bumiputera companies - firms run by ethnic Malays - as part of the group's wider remit to drive Bumiputera participation in the economy.
The capital outsourcing program began in 2012 and saw 30 firms register interest, of which 16 submitted proposals and seven were shortlisted for due diligence. Of the MYR400 million Ekuinas committed in the first tranche, MYR177.3 million has so far been invested in seven portfolio companies.
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