IFC and EBRD co-invest $25 mln in Dragon Capital's Rebuild Ukraine Fund
The International Finance Corporation (IFC) from the World Bank Group and the European Bank for Reconstruction and Development (EBRD) are investing $25 million each in the Rebuild Ukraine Fund, founded by Tomas Fiala's Ukrainian investment company Dragon Capital.
"The European Bank for Reconstruction and Development (EBRD) and the International Finance Corporation (IFC) have jointly committed $50.0 million (EUR 43.6 million) to the Rebuild Ukraine Fund, a new private equity fund managed by Dragon Capital. The fund will provide long-term equity and quasi-equity financing for Ukrainian small and medium-sized enterprises (SMEs) and mid-cap companies," according to a joint press release on Friday following the signing of the relevant agreements in Warsaw at the Rebuilding Ukraine conference.
The EBRD and IFC’s anchor investments of $25.0 million (EUR 21.8 million) each will help the fund to achieve a viable first close and send a strong signal to the market highlighting the importance of investing in Ukraine.
The Fund aims to deploy $250 million of capital in total, targeting companies across a range of sectors critical to Ukraine’s resilience and recovery. These include, but are not limited to, consumer retail and services, healthcare, financial services, construction materials and agriculture-related sectors.
To mitigate investment risks, a portion of IFC’s equity investment will be covered by guarantees provided by the European Commission under the Ukraine Investment Framework and the government of France in support of IFC’s Economic Resilience Action Program for Ukraine.
Dragon Capital Founder Tomas Fiala said: "We are proud to partner with the EBRD and IFC… Their support of the Rebuild Ukraine Fund sends a strong signal of confidence in the country’s private sector and its future. The Fund will provide much-needed capital to help Ukrainian businesses adapt, grow and lead the recovery process."
Managing Director and Head of Direct Investments at Dragon Capital, Andriy Nosok, announced at the Ukraine Recovery Conference in Rome in July that the company was investing its own $20 million in REBUF. According to him, the first closing of the fund was planned for September of this year.