Global Investment House "Global" announced today that Global Opportunistic Fund II (GOF II), the USD1 billion Pre-IPO and IPO Fund, has received overwhelming response from the regional investors in the first two weeks of its launch.
The fund intends to invest across 17 different countries including India and China.
Omar M. El-Quqa, Executive Vice President at Global, said that the fund has received firm commitments of over USD500 million and investor interest in this opportunity is still increasing from all across the region and outside.
Global is currently managing another Pre-IPO/IPO fund, Global Opportunistic Fund I, with a capital of USD550 million which focuses primarily on the investment opportunities in the GCC markets.
El-Quqa pointed that investors in the USD550 million fund has already benefited from the impressive performance of this fund which has made capital gains of over 70% on the partial sale of two of its investments, thus enabling a distribution to its unit holders in less than 8 months since closing.
“The Fund has already lined up several of its investments for sale in the next twelve months which is expected to yield a capital appreciation of over 150% and return almost half of the invested capital back to the investors,” he added.
Besides the success of the earlier fund, which has existing commitments in excess of USD 400 million, the recent turmoil in the GCC stock markets have given all the more reasons for the regional investors to capitalize on this opportunity to diversify their holdings across the ‘hot’ and emerging markets of Asia and North Africa.
GOF II proposes to invest 60% of its net asset value outside GCC, especially in the high growth economies like China, India Pakistan and Turkey. It has already made an investment of over USD30 million in Reliance Petroleum Limited, which will be the sixth largest refinery in the world on completion.
The main promoter, Reliance Industries Limited (RIL), is a Fortune 500 company with USD18 billion market capitalization and currently operates the third largest refinery in the world.
The fund, in addition to Reliance Petroleum, has built up a significant pipeline of transactions that includes opportunities in China, Saudi Arabia, Qatar, Turkey, India and the UAE. In addition to these transactions, there are significant number of IPOs planned in the target countries.
China has over 80, Saudi Arabia in excess of 70 and India over 100 IPOs, which will give the fund significant opportunities to earn returns. Global through its strong relationships and presence in these key markets will be ideally positioned to capitalize on these opportunities.
El-Quqa ended by saying that Global now expects to receive the required commitments of USD 1 billion much earlier than the indicated closing date. “The allocation to the fund will be on a first come first serve basis and the fund may be closing during the month of May.”
