€50 million investment in Accession Mezzanine Capital III
The EBRD is building up its support for the corporate sector in central and eastern Europe with an investment of up to €50 million in a new investment fund, Accession Mezzanine Capital III L.P (AMC).
The fund, a new offering from Mezzanine Management Central Europe Limited (MMCE), will focus on supporting private equity-backed acquisitions with mezzanine capital, as well as providing additional financing to enterprises with a proven business model and sustainable cash flows, helping them to pursue further growth.
In the current market conditions when availability of debt financing remains scarce, this project will provide a much-needed source of capital for the further development of the corporate sector in the region.
AMC III aims to raise €300 million and has received aggregated commitments of €130 million at its first closing. It will target investments in mid-cap manufacturing companies and service providers, operating in central and eastern Europe. A portion of the Fund’s resources will be dedicated to enterprises in Ukraine, Russia and Turkey.
“Supporting the development of the corporate sector in its countries of operations is one of the EBRD’s key priorities in the current environment. This project will expand the level of financial intermediation in the region, bringing additional capital to underpin the growth of enterprises with a strong business model in the current tight credit markets”, said Anne Fossemalle, EBRD Director for Equity Funds.
“This transaction is a continuation of the EBRD’s relation with MMCE, which has a strong track record and solid knowledge of the region”, added Anne Fossemalle.
Franz Hoerhager, Founding Partner of MMCE, said: “I am pleased to see that the EBRD continues as a repeat investor in our new fund Accession Mezzanine Capital III. This bolsters our position as the leading junior capital provider in the region, and supports our intention to move into new emerging mezzanine markets such as Turkey.”
The EBRD has a long standing relationship with MMCE having participated as a cornerstone investor in Accession Mezzanine Capital I and II funds. So far during the life of AMC I and II, the fund managers have reviewed over 500 transaction proposals and have made 27 investments worth over €320 million.
To date the EBRD has committed over €2.5 billion in private equity and mezzanine funds operating in the region, which have raised additional resources in excess of €12 billion.