Asia Debt Management Hong Kong has launched a fund dedicated to investing in recovery situations in the Central Asian republic of Kazakhstan.
The ADM Kazakhstan Capital Restructuring Fund will focus on privately-owned, small to medium-sized companies over a wide range of sectors with limited access to external capital as a means to grow.
"In the aftermath of the global economic crisis, Kazakhstan’s troubled banking system has paralysed the country’s economic growth," says Robert Appleby, chief investment officer of ADM Capital. "However, access to external credit can propel debt-burdened companies with otherwise healthy fundamentals back into profitability. We see solid investment opportunities throughout the region.”
The fund has closed at USD100m, and will target up to USD225m at a second and final closing. The European Bank of Reconstruction and Development will invest up to USD72m in the fund, and Kazyna Capital Management, a subsidiary of Kazakhstan’s Samruk-Kazyna sovereign wealth fund, will be a major investor.
ADM Capital plans to invest in stressed companies in Kazakhstan, as well as in growth situations, providing capital to well-run businesses burdened by heavy debt loads made worse by the weak economy. The former Soviet republic is the ninth largest country in the world, with a landmass the size of Western Europe. To date, investor focus in the country has been largely limited to exploration and related industries.