Pension funds managed by INVL Asset Management, one of Lithuania’s leading asset management companies, became the second-largest investor in the Lithuania SME Fund established by the private equity and venture capital firm Baltcap as part of the European Investment Fund’s JEREMIE initiative in Lithuania.
The INVL Extremo II 16+ and INVL Medio II 47+ pension funds acquired 10 per cent of the Lithuania SME Fund and 4.9 per cent of the Baltcap Latvia Venture Capital Fund which operates in Latvia. The largest investor in these funds is the European Investment Fund (EIF), which holds 70 per cent of the fund in Lithuania and 67 per cent of the fund in Latvia.
“Our strategy is to steadily increase our pension funds’ investments in Lithuania and the other Baltic states, thereby contributing to these countries’ economic growth and seeking to earn an attractive return for the clients of the pension funds,” said Vaidotas Rūkas, the Chief Investment Officer at INVL Asset Management.
He said secondary-market transactions to acquire private equity fund units are quite popular around the world, though rare in the Baltics. “We have the biggest team of investment managers in the country and are ready to consider these types of transactions if private equity fund investors in the Baltic countries need liquidity,” Rūkas said.
Baltcap Partner Kornelijus Čelutka expressed gratitude for that trust and welcomed the new investor to the growth capital funds that Baltcap operates in Lithuania and Latvia. “This investment decision by INVL Asset Management, one of the country’s biggest asset managers, shows the growing role local pension funds are playing in the private equity market. That’s important both for the creation of new funds and to ensure liquidity for investors in already existing funds,” he said.
In Lithuania, the Lithuania SME Fund has invested in companies including Impuls, Caffeine Roasters, Labochema, InMedica and Yglė Pastatų Valdymas. In Latvia, companies in which the Baltcap Latvia Venture Capital Fund has invested include EuroLCDs, AGroup, Vendon, EKJU, Stenders, Pure Chocolate and Amateks.
The Lithuania SME Fund and the Baltcap Latvia Venture Capital Fund were established in 2010 as part of the JEREMIE programme (Joint European Resources for Micro to Medium Enterprises) – a joint initiative of the European Commission (DG Regional Policy) and the European Investment Bank Group aimed at improving companies’ access to external sources of financing by deploying part of the EU Structural Funds allocated for the period 2007-2013.
The INVL Extremo II 16+ and INVL Medio II 47+ pension funds managed by INVL Asset Management invest in company shares and related instruments. The INVL Extremo II 16+ pension fund has an equity allocation of 100 per cent, while the INVL Medio II 47+ fund’s equity portion is 50 per cent.
INVL Asset Managementis part of the Invalda INVL group. Companies in the group manage pension and mutual funds, alternative investments, private equity assets, individual portfolios and other financial instruments. More than 180 000 clients in Lithuania and Latvia as well as international investors have entrusted them with assets of over EUR 520 million.