Finansa to launch $50m in distressed Asian assets fund

Finansa to launch $50m in distressed Asian assets fund

Dow Jones Bangkok

Thailand-based financial group Finansa PCL is planning to launch within two months a new fund that will invest in distressed assets throughout Asia, with an initial target size of US$50 million, Finansa Chairman Eugene Davis said on Monday.

The new fund's focus will be on Southeast Asia, mainly Thailand and Indonesia where Finansa has most of its experience, but it will also seek to invest in distressed assets in China, Japan, South Korea, Taiwan and possibly India, Davis told reporters.

"(The new fund's investments) will be essentially dollar paper from any Asian borrower, with a highly diversified portfolio," Davis said.

Finansa is expecting its experience in the debt restructuring of Thai debtors since the 1997 economic crisis will enable it to tap U.S. and European money seeking to return to Asia, as well as Asia-based investors.

The fund will look at providing annualized returns of 15 percent to 20 percent, Davis said, adding that a realistic duration for the fund will be three years, with an initial lockup period of one year.

He said the fund will be open-ended and structured like a hedge fund, allowing additional investments on a monthly basis that hopefully could boost the fund's size to $200 million.

Finansa, which describes itself as a merchant bank, currently runs fund management, securities brokerage, corporate finance, and investment banking operations. It has investments and business operations in Thailand, Indonesia and Vietnam.

Finansa's existing funds include the Vietnam Frontier Fund and two Siam Investment Funds, which have raised a combined $130 million.

Davis said Finansa is also mulling the launch of a new Vietnam fund.