Nepal's Dolma set to close $37m top-up fund
Nepal-focused private equity investor Dolma Impact Fund has received $37 million in commitments for a top-up vehicle that will pursue additional investments by its debut fund.
The top-up extends a $26 million close achieved in 2015. This initial corpus has been fully committed or deployed, but the firm has identified a number of new opportunities on the back of a strengthening local economy.
Terms of the extension are expected to be finalized in June. All investors in the top-up are existing LPs in the fund, which include Netherlands-based FMO and three other European development financial institutions, and two family offices. It coincides with improved investment sentiment in Nepal following a successful transition to a democratic government regime.
“We’ve seen growth in our companies, construction activity, financial closes, and more funds, but the big thing is the political environment,” Tim Gocher, founder and CEO of Dolma, told AVCJ. “Nepal has seen an incredible social achievement with its recent elections, and the feeling is feeding into business confidence. It’s a positive sign that wasn’t there when we started in 2014, and we’re seeing our pipeline grow as a result of that.”
Dolma makes investments of $2-5 million across the infrastructure, consumer, and industrial sectors. It took a 49% stake in a pharmaceutical company called Rhododendron Biotech and backed a technology player in the business process outsourcing space known as CloudFactory Group. Other investments include a manufacturing facility and a hospital.
Recent activity by Dolma also includes a $3.2 million commitment to Swet Ganga Hydropower & Construction and the firm is considering other similar investments. Power shortages are a major hindrance to Nepal’s economic development and Dolma wants to help attract more foreign capital into the sector by proving its commercial viability.
Dolma claims to be the first international PE fund purely focused on Nepal. Its core strategy includes a focus on balancing the country's trade deficit with India by targeting companies that substitute imports while also empowering the local population.
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