ADB makes LP commitment to KV Asia's second fund
Asian Development Bank (ADB) has confirmed an investment of USD 15m in the second Southeast Asia lower middle market private equity fund from KV Asia Capital.
It follows a first close of USD 100m featuring Adams Street Partners and HarbourVest Partners last year. The target is USD 300m.
“Through KV Asia II, ADB will help improve access to financing for mid-sized companies in Southeast Asia where the availability of equity capital is limited for this size of companies,” Janette Hall, a director focused on private sector funds and special initiatives at ADB, said in a statement.
“The financing will help companies to scale, acquire new customers, expand into underpenetrated markets, and provide high quality and efficient services that help countries to accelerate progress on sustainable development goals.”
Fund I closed on USD 263m in 2013 with support from Adams Street, HarbourVest, Morgan Stanley Alternative Investment Partners, Hermes GPE, Cambridge University, Alpha Associates, Industriens Pension, and Alaska Permanent Fund.
Fund II was tentatively launched in 2019 but delayed to focus on the exit of Malaysian grocery retailer TF Value Mart to Intermediate Capital Group. The process began in earnest in January 2021.
The new fund will pursue control buyouts with some scope for significant minority positions where a board seat and operational influence can be obtained. Investments will span Southeast Asia with an emphasis on Malaysia, Indonesia, Vietnam, and Singapore.
Fund II has made two investments to date, including the purchase of a 25% interest in Indonesian beauty and personal car brand Victoria Care for USD 43m and a majority acquisition of Malaysian rubber glove manufacturer G.B. Industries for an undisclosed sum.
KV was founded in 2010 by Karam Butalia and Vibhav Panandiker, both formerly of Standard Chartered Private Equity. It typically writes cheques in a range of USD 25m to USD 75m, with a preference for local champions in essential consumables.
ADB aims to reduce poverty in Asia Pacific by promoting economic and environmentally sustainable growth and regional integration through both direct investment and fund commitments. In Southeast Asia, it has supported funds raised by the likes of Creador, Mizuho Bank, Ascent Capital, and Navagar.
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