FMO set to invest US$20m investment in PE fund in Ezdehar Mid-Cap Fund II

EGYPTFMO, the Dutch entrepreneurial development bank, has invested US$20 million in Ezdehar Mid-Cap Fund II, a fund will be managed by Ezdehar B.V, as it aims to provide capital to SMEs/Mid-cap companies operating in Egypt.

This represents a continuing relationship for FMO, having committed to the predecessor fund, Ezdehar Egypt Mid-Cap Fund Coöperatief U.A., in 2016.

The Fund Manager intends to promote development by enhancing sustainable growth of private sector businesses in Egypt.

The investment strategy of Ezdehar II will be in line with the successfully implemented strategy of its predecessor, targeting mainly family-owned companies looking to grow and institutionalise with the support of a hands-on partner.

This comes a month after the fund, through its founder and Managing Director Emad Barsoum, announced that it expects to reach first close on its second fund by November.

The firm expects its Ezdehar Egypt Mid-Cap Fund II will reach first close with US$100-120 million in commitments from limited partners.

A second and final close that will leave the fund with a total of USD160-180 million is likely to take place in 1Q2022, he said.

Ezdehar had originally targeted US$200 million fund with two closes of about US$100 million each.

The new fund will focus on manufacturing, pharma, healthcare, consumer goods, F&B and education.

This second fund will invest its money over a four-year period in six to eight transactions. The fund will target mid-cap companies, family business and founder-led companies.

Covid has set the firm’s plans back a year: The company previously planned to reach first close in late 2020 but was delayed due to covid. Ezdehar was also aiming for the second close of the fund to come before the end of the year.

The firm is presently looking at the potential launch of an impact investing fund later this year or next, Barsoum previously said.

Impact investing is when the folks committing capital do so in the expectation that their investment will have a positive environmental and social impact at the same time as it generates a financial return.

The first fund: The company launched its first US$100 million investment vehicle, Ezdehar Mid-Cap Fund I, in 2016 to invest in mid-cap companies.

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