Baring Vostok closes Russian fund on $400m

Baring Vostok Private Equity Fund III has closed ahead of an original $350 million target and will invest in businesses in Russia, Ukraine and the former Soviet Union.

Baring Vostok Capital Partners has announced a final close of its oversubscribed third private equity fund on $400 million (€303 million).

Baring Vostok Private Equity Fund III had an original target of $350 million but received increased investor demand. UBS acted as the fund’s sole global placement agent.

The fund will follow the same investment strategy as previous Baring Vostok funds, focussing on the oil & gas, media, telecoms and financial services sectors. The fund will concentrate predominantly on acquiring companies in Russia, Ukraine and other parts of the former Soviet Union according to a press release.

Co-managing partner of Baring Vostok Michael Calvey said in a statement: “Russia and the CIS remain challenging markets in many respects, but the returns on investment are very attractive and compare favourably with most other countries or regions.”

Calvey went on to say that the businesses Baring Vostok focuses on: “are mostly growing fast, generating strong profit margins and are generally not exposed to the political risks that have impacted some of the country’s largest companies.”

The new fund is a successor to the firm’s 1994 $106 million First NIS Regional Fund and the 2001 vintage Baring Vostok Private Equity Fund, which raised $205 million.

Since 1994, the firm has invested $336 million in 40 companies, of which 23 have been fully or partially realised.

Baring Vostok is a member of Baring Private Equity International (BPEI), the private equity asset manager that completed its MBO from parent company ING Group in June 2004.

Under the restructuring of the organisation, the senior partners managing BPEI’s regional funds acquired ownership of the respective businesses, all of which continue to use the Baring Private Equity brand.

In July the firm appointed Sergey Abramov and Philippe Der Megreditchian as partners.