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Tue 14 Jun 2011 10:28 AM

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Samena sees initial closing of $700m fund in two weeks

Hong Kong’s Samena Capital eyes investments in hydrocarbon, aluminium sectors

Samena sees initial closing of $700m fund in two weeks
Hong Kong-based Samena Capital has more than $400m in assets under management

Hong Kong investment group Samena Capital expects to raise $700m for its second special situation fund within in the next two weeks, five months ahead of schedule, its vice chairman said.

The seven-year, closed-ended private equity-style fund will be used to invest in listed securities in Asia, the Middle East and North Africa, likely in firms in the hydrocarbon and aluminum industries that have the capacity to expand globally, said Shirish Saraf.

“We are going to be well oversubscribed, well ahead of time. We were going to go with an initial closing of probably six months down the line but we are going to announce initial closing in two weeks,” the vice chairman and CEO told Arabian Business.   

The fund already has commitments of $350m; the rest will be made up by institutional investors. Favoured investments are likely to be made in small to medium-capped firms, said Saraf.

“By nature any hydrocarbon-based industry has a natural competitive advantage here [as do] aluminum manufactures and infrastructure type companies,” he said.

“In all these, eventually you are looking for the ability of the companies based here that clearly have the bandwidth, the management capability and the ability to grow beyond their borders.”

The firm's first five-year fund, Samena Special Situations Fund, made investments in India's HBL Powers Systems, Eicher Motors and offshore oilfield services company Rubicon Offshore International.

Samena, which manages more than $400m in assets, recently exited its investment in Eicher, generating a return on investment of 5.4 times in less than two years.

The six Gulf states continue to offer the best investment opportunities in the Middle East, which has been roiled by a wave of Arab Spring revolts in recent months, Saraf said.

“I still think that the GCC economies remain on very sound footing. They don’t have the typical problems of the rest of the Levant or Egypt. Opportunities are immense but they’ve got to be selective,” he said.

Samena Capital was established in 2008 with an initial equity of $50m.

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