Cross-border deals complicate the 'regional fund vs country fund' debate - AVCJ Forum

"Whether it is better to have a regional fund or a country fund depends on the GP," Roy Kuan, managing partner at CVC Capital Partners, said at the AVCJ Forum during a panel dicussion on the localization of regional firms. "It depends on their expertise and what they are good at, as for our firm we are better at being a regional fund."

David Mintz, founding managing director of Olympus Capital, said he didn't think the debate was as one dimensional as "country funds verses regional funds."

"The Asian PE industry has matured, the seller has matured and the market has deepened," he said. "The issue over whether to have a global team is resolved - game, set and match." Mintz added that the real question is what strategy GPs with regional funds will use to apply country specific expertise across the region.

"The debate has been going on for around 10 years," said K.Y. Tang,  chairman and managing partner of Affinity Equity partners. "One trend that has emerged in the last 18 months has been in favor of regional funds in their ability to shift quickly from one part of Asia to another."

Nicolas Bloy, co-founder and managing partner at Navis Capital Partners, noted that some of the best deals he had come across were more complex to execute and involved cross-border growth and cross border M&A. He believes this favors regional vehicles.

"It is very hard for a country fund to execute that sort of regional growth strategy," Bloy said. "In our portfolio we have had 57 yeilds, in two thirds of the cases they involved foreign investment. These more complex regional cross-border investments have delivered 1,300 basis points more than the average."

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