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Three Fund Managers selected for IDB-China Eximbank New Equity Investment Platform

17 October 2012

(IDB) October 17, 2012 – Macquarie Infrastructure and Real Assets (MIRA), Darby Private Equity, and SinoLatin Investment Advisors (SLIA) have been selected to manage an investment platform for Latin America and the Caribbean that is being created by the Inter-American Development Bank (IDB) in partnership with the Export-Import Bank of China (China Exim).

The new platform, consisting of three regional investment funds, is expected to mobilize as much as $1.8 billion for equity investments to support economic and financial integration between Latin America and the Caribbean (LAC) and China. The LAC-China Platformis expected to attract a geographically diversified pool of investors, including Chinese investors, to deploy risk capital in companies and projects operating in sectors that are vital for the development of the region, namely infrastructure, mid-size companies and natural resources, including agribusiness, energy and mining in the pre-production stage.

“This investment platform will positively impact development of Latin America and the Caribbean by providing long-term financing to improve transportation and logistics, enhance the competitiveness of firms and help increase food production, sustainable forest management and the availability of raw material for industrial production,’’ said IDB President Luis Alberto Moreno. “This is another step toward strengthening trade and investment between two of the fastest-growing regions of the world to support job creation and poverty reduction.”

The three fund managers were announced during the Sixth China-LAC Business Summit, which this year is being held in Hangzhou, China. The platform will consist of three regional investment funds:

  • the LAC-China Infrastructure Fund, focused on infrastructure projects, to be managed by MIRA (a division of Macquarie Group);
  • the LAC-China Mid Cap Corporate Fund, which will target mid-size companies already in operation throughout a wide range of sectors, to be managed by Darby Private Equity; and
  • the LAC-China Natural Resources Fund, focused on mid-size projects and companies engaged in agribusiness, mining and energy, to be managed by SinoLatin Investment Advisors (SLIA), a joint venture between SinoLatin Capital and EMP Global.

The IDB’s policies will guide the investment practices of the Funds and a Consultative Body will be established to collect and publish information regarding the development, environmental and social impact of the Funds’ investments.

“Given Latin America’s rich endowment of natural resources and sensitive biodiversity, it is paramount that investments flowing to the region are carried out in an environmentally and socially responsible manner and that the highest standards of corporate governance are applied,” said Hans Schulz, General Manager of the IDB’s Structured and Corporate Finance Department.

The investment platform is based on a letter of intent signed between the IDB and China Eximbank in 2011, when both institutions announced the plan to establish a mechanism to finance projects in the IDB’s 26 borrowing member countries in Latin America and the Caribbean. The IDB expects to provide $150 million in loans to help establish the funds, subject to consideration by its Board of Executive Directors. Similarly, China Eximbank is in the process of seeking approval from the relevant authorities.

About the IDB

The IDB is the leading source of long-term financing for the Latin America and the Caribbean. Founded in 1959, the IDB has 48 member countries, of which 26 are borrowing member countries from Latin America and the Caribbean. China joined the IDB in 2009. The Structured and Corporate Finance Department (SCF) leads the IDB’s non-sovereign guaranteed operations for large-scale projects, as well as those linked to companies and financial intermediaries.

Export-Import Bank of China (China Eximbank)

China Eximbank is a state bank solely owned by the Chinese government. Its international credit ratings are equivalent to the national sovereign ratings. As an important force in promoting foreign trade and economy and a significant component of the financial system, China Eximbank has been assisting Chinese companies and promoting Sino-foreign relationships and international economic and trade cooperation.