IFC to launch Asia Fund with $1-1.5-bn target

Will provide additional capital for co-investments alongside IFC in emerging markets in Asia

The World Bank's investment arm, International Finance Corporation (IFC), is planning to launch an IFC Asia Fund with a target size of $1-1.5 billion. The fund will mobilise additional capital for co-investment alongside IFC in emerging markets of the Asia-Pacific region. The fund will be managed by IFC Asset Management Company LLC (AMC).

IFC said AMC mobilises and manages third party funds for investment in developing and frontier markets.  It was created in 2009 to expand the supply of long-term capital to these markets by accessing IFC's global reach, investment approach and standards. IFC will seed the IFC Asia Fund. Large global institutional investors are expected to invest alongside IFC.

IFC's investment will be 20 per cent of total commitments made to the IFC Asia Fund might subject to an overall cap of $200 million. The fund will be located in one of the IFC member-countries, to be determined upon completion of due diligence.

The fund will focus on various sectors, including infrastructure (transport, power, oil and gas, logistics, real estate, etc), manufacturing and services (hospitals, retail, textiles, metals, fertilisers etc.) and financial markets (banks, private equity funds and non-banking financial companies) and in a geographic span across Asia.

The investment strategy is that it will co-invest in new IFC projects and may also invest in IFC Portfolio projects. Therefore, the fund will potentially be exposed to all sectors within infrastructure, manufacturing, agribusiness and financial markets that IFC invests in.

The global investment giant said it brings not only capital, but also sustainability, governance and operational advice. This will enable investee companies to raise standards, improve risk mitigation and generate value. IFC acts as long-term partner to its investments and brings a network of global knowledge, technical expertise and best practices. “IFC's investment will send a strong signal of IFC's commitment to the region, re-inforce investor's confidence and encourage investment in the region,” said IFC, in a project disclosure.