Lombard seeking $500m for third Asian fund

Lombard Investments is raising its third private equity fund dedicated to Asia, with backing for the vehicle coming from CalPERS and The Asian Development Bank (ADB).

Lombard Investments, with offices in San Francisco, Bangkok and Hong Kong, has held a first close of $153 million (€127 million) for Lombard Asia III. The firm, according a statement, is seeking between $300 million and $500 million for the vehicle.

The new fund will target China and Southeast Asia, and is a follow up to Lombard’s Thailand Equity Fund, a $245 million vehicle raised in 2001, and Lombard Asian Private Investment, a $252.5 million fund raised in 1997.

Lombard is apparently going after the burgeoning consumer base in the region, as it is targeting investments in food, tourism, retail and financial services, as well as plays in manufacturing and auto parts. The fund intends to write equity cheques of between $10 million and $50 million in size per investment.

Based on information on the website of The Asian Development Bank (ADB), an investor in the fund, the firm has upped its target for the vehicle since it first started fundraising early last year. In February of 2005, ADB indicated that Lombard was seeking between $200 million and $250 million in limited partner commitments for the vehicle, a far cry from the $500 million cap the firm has since established.

The California Public Employees’ Retirement System (CalPERS) is investing in the vehicle, alongside ADB, while Taiwan’s International Cooperation and Development Fund (TaiwanICDF) has indicated on its website that it is also considering an investment. The CalPERS commitment, at $75 million, makes up almost half of Lombard’s first closing.

Past investments by the firm include a January growth financing in Kantana Group, a Thailand-based TV and film company, and an investment in Ticon Property Fund, a real estate business that Lombard floated on the Bangkok Exchange last summer.

CalPERS, a return investor for Lombard, has indicated on its website that the firm’s Thailand Equity Fund has already returned 1.1x its invested equity, and is currently showing an IRR of 4.1 percent.

Calls to Lombard were not returned by press time.