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Aureos to close Asian funds, eyes Malaysia

Aureos Capital is nearing closings on several Asian private equity funds and plans to launch a new Malaysia-focused vehicle before the end of the year.

Aureos Capital, the international emerging markets specialist, is nearing initial and final closings for at least three funds that will target small-medium enterprises (SMEs) in emerging markets across Asia.

The firm is also in discussions with a handful of local financial institutions to launch a new fund for investing in Malaysia.

Robert Binyon, chairman of Aureos South East Asia Managers, said in an interview that the firm should be reaching a final close on $95 million to $100 million for Aureos South East Asia Fund (ASEAF), a fund covering Thailand, Indonesia, Philippines and countries in the Mekong Delta, “in the next few weeks”.

Binyon, who is based in Bangkok, also said the firm would be holding a first close by the end of June on $30 to $32 million for a fund that will focus mainly on the Shandong province in Northeast China, and an imminent close on $20 million for a vehicle investing in the Pacific Islands.

Separately, Aureos has been in discussions with a handful of Malaysian investors in the run-up to launching a new RM 250 million ($69 million; €54 million) fund that aims to provide risk and expansion capital to SMEs in Malaysia. The Malaysia fund will be Aureos’ first in the country, which is not covered by ASEAF.

“Malaysia was previously excluded, as it was deemed a relatively developed country. For the new fund, we would be looking at companies that are in the post start-up stage with a degree of established track record, some years before IPO, probably seeking second- or third-stage expansion capital. We will work closely with the local banks, who will be the ones to provide further financings to the SMEs we invest in,” Binyon said.

Aureos is also in the process of putting together a $100 million South Asia fund covering India, Bangladesh and Sri Lanka. This fund will include an India-only investment side-vehicle that should appeal to domestic investors, Binyon told PEO.

Across emerging Asian economies, Aureos is estimated to raise up to $350 million this year for a series of debut funds, according to Binyon. Established in 2001, Aureos has to date been managing funds raised as an affiliate of CDC in the UK. CDC remains a key supporter of Aureos, having committed $20 million, alongside Norfund with another $20 million, toward ASEAF last year.