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International Internet Magazine. Baltic States news & analytics Monday, 06.07.2020, 04:40

EUR 300 mln to be invested in Baltic private, venture capital funds

BC, Riga, 06.08.2019.Print version
The European Investment Fund (EIF) and the three Baltic countries of Estonia, Latvia and Lithuania signed a Baltic Innovation Fund 2 agreement according to which more than 300 mln euros is to be invested in Baltic private and venture capital funds through the fund over the course of the next five years.

The purpose of the investments is to stimulate capital investment in small and medium-sized enterprises (SMEs) to accelerate their growth, the EIF said.

Three national financing institutions of the Baltic states -- KredEx in Estonia, Altum in Latvia and Invega in Lithuania -- are to invest 26 mln euros each into the fund-of-fund initiative and the EIF, in turn, will contribute 78 mln euros. In addition, fund managers selected by the EIF will also have to raise money from private investors, which will bring the total investment in Baltic companies to over 300 mln euros.

Pier Luigi Gilibert, chief executive of the EIF, said that Baltic Innovation Fund 1 is a good example of how cooperation between three countries can significantly impact the Baltic capital market.

"More than 435 mln euros of investments has been raised through the Baltic Innovation Fund 1 for investment in local businesses and we are proud that this capital has made local pension funds more active in the local economic system. Our continued partnership in the framework of the Baltic Innovation Fund 2 will further improve the development and long-term sustainability of the Baltic capital market," Gilibert said.

"The Baltic Innovation Fund is a prime example of how, by working together, the three Baltic countries are making small capital markets more attractive to investors and providing additional financing opportunities for fast-growing companies," KredEx CEO Lehar Kutt added.

Directly and through its subsidiary, AS SmartCap, KredEx is participating in four fund-of-fund initiatives, which include the Baltic Innovation Fund 1, EstFund, Early Fund II and the Baltic Innovation Fund 2. In total, these funds have a value of more than 400 mln euros, to which private investors will add nearly 800 mln euros.

The European Investment Fund (EIF) is a specialist provider of risk finance to benefit small and medium-sized enterprises (SMEs) across Europe and is part of the European Investment Bank (EIB) Group. EIF's shareholders are the EIB, the European Union, represented by the European Commission, and a wide range of public and private banks and financial institutions.

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