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Venezuela-Focused Fund to Launch Later This Year

3 August 2015

(Bloomberg) Thomas Samuelson, a founder of Miami-based INCA Investments, and two partners plan to raise a US$50m to US$75m private equity fund to invest in Venezuela.

The fund will be the first to focus exclusively on the country, Samuelson said in a phone interview.

Emerging markets specialist Leopard Capital Group will be an adviser to Gran-Venezuela Opportunities Fund.

Management also includes Caracas-based Carlos Emmanuelli, the chief executive of paper and printing business Proteco Caracas, and Pedro Urdaneta, a partner at the law firm Imery Urdaneta Calleja Itriago & Flamarique, S.C. Samuelson and Emmanuelli worked together at Credit Lyonnais in the 1990s, Samuelson said. He left INCA in 2005.

Fundraising will like begin by the end of the third quarter, he said.

Venezuela’s inflation reached 113.2 percent year-on-year in June, according to analysis from Bank of America Corp. The Bolivar has fallen 95 percent in the past year, based on the Simadi exchange rate, which was about 199 Bolivars to the dollar this week, according to data compiled by Bloomberg.

In addition to local companies hurt by the economy, there are potential acquisitions to be made from multi-national firms planning to walk away from their Venezuelan operations, Samuelson said. Bad economic policy will continue to hurt businesses this year and next, he said, but he expects change to come.
“No government can survive devaluation like this,” he said.

The fund will be seeded by its managers and have a 2.5 percent management fee and 20 percent carried interest, Samuelson said.