Asia Capital Sri Lanka Hybrid Fund to promote investments into Sri Lanka

By David Ebert

Asia Wealth Management Company Ltd., a fully-owned subsidiary of Asia Capital PLC, yesterday announced the launch of the Asia Capital Sri Lanka Hybrid Fund in partnership with CD One Limited of Japan, whereby CD One would set up this fund to promote investments into Sri Lanka.

Incidentally, the fund is the first of its kind to be set up in Japan, where CD One would look at promoting the country, which has largely been unknown as a lucrative investment destination among Japanese investors who are likely to view the country’s current economic growth favourably.

Asia Wealth Management, which has been appointed the manager of this pool of funds, is a boutique investment advisory unit under the Asia Capital Group.

Under the agreement, a sum of Rs. 1.5 billion will be collected from Japanese corporates and high net worth individuals based on an information memorandum prepared by Asia Wealth Management covering the spheres of private equity, listed equity and fixed income. The fund will be invested into the Colombo Stock Exchange, potential private equity projects, treasury bills, bonds, and corporate bonds.

Elaborating on the concept Asia Capital PLC Director and Group CEO Stefan Abeyesinhe stated: “This is something new that we have done, setting up a fund under a company incorporated in Japan called Ceylon Development One, which has a consortium of investors who got together, capitalised the company, and are dedicated to investing in Sri Lanka starting in January. We have been working on which sectors and areas to go into and we have decided to focus mainly on listed equity, private equity, and fixed income. We are extremely excited about the potential of the fund and the positives that can be gained in terms of development for the country.”

V’s Capital CEO Toshiaki Tanaka said: “The Japanese public has realised the enormous potential for investment in Sri Lanka and is very eager to invest. Sri Lanka, with its attractive interest rates and warm and friendly people, is exactly the kind of market we are looking for as it mirrors so many of the traits we look for in business partners. We are very excited about the future and look forward to working closely with Asia Wealth Management, with which we have an excellent working relationship.”

Speaking about the partnership, Asia Wealth Management Director Saminda Weerasinghe said: “We are very pleased to have tied up with CD One Limited, which will be bringing in much money and development to Sri Lanka. We are proud to play a part in this development process, which will see a large infusion of capital coming into Sri Lanka. Interest rates are very high at the moment, making this the best time to invest into private equity projects and listed equity due to the attractive valuations. We have been working very closely with Japanese investors for almost a year and it has been a most fruitful partnership.”

Weerasinghe also stated that the CD One fund would be the first of such funds to be launched, with the company looking at possible second and third stage funds as well with much higher investment ceilings and a broader investment outlook stemming from the success of this initial venture.

Providing integrated capital markets and advisory services, Asia Wealth offers innovative solutions across a wide range of products, including capital raisings, restructurings, project finance, structured finance, and tailored strategic and financial advice. The company’s most important role, however, is to exploit synergies between the other three core holdings of the Group.