On July 12, 2012, the first closing of the Leopard Haiti Fund (“LHF”) took place, with FMO taking a role as anchor investor by investing USD 8.5 million. LHF is the world’s first private equity fund to operate and focus exclusively on Haiti since the 2010 earthquake. As an anchor investor in LHF, FMO will play a vital role in the reconstruction of low-income and earthquake-hit Haiti, by providing highly needed risk capital through a SME-fund with a high-quality, locally based investment team.
The fund seeks to raise USD 40 to 75 million to invest in businesses in Haiti. The first USD 20 million of this target has now been committed by three international development banks:
• $8.5 million by International Finance Corporation (IFC);
• $8.5 million by Netherlands Development Finance Company (FMO), through MASSIF, a dedicated fund for SME development;
• $3.0 million from the Multilateral Investment Fund (MIF), a subsidiary of the Inter-American Development Bank (IADB).
The fund is managed by Leopard Capital, a fund management group exclusively focusing on post-conflict countries (or post-natural-disaster in the case of Haiti). They will now commence LHF’s investment activities while continuing to approach investors globally and locally to increase the size of the fund. Leopard Capital is concurrently raising a donor-funded technical assistance facility to finance capacity development initiatives within LHF’s portfolio companies.
LHF aims to gain long-term capital appreciation through investing in a diversified portfolio of private enterprises in Haiti. The Fund seeks commercial investments with the potential to provide positive economic and social impact.
The Fund will invest risk capital (through equity or quasi-equity instruments) into four priority sectors: 1) Food Processing, 2) Tourism, 3) Affordable Housing and 4) Renewable Energy. It may also selectively invest in other sectors. The majority of the Fund’s investments will focus on expanding existing businesses, including recapitalizing and rebuilding businesses damaged in the 2010 Earthquake. Some of the Fund’s investments will be in small and medium enterprises (SMEs) and/or start-up ventures.
In addition to financing LHF will provide its portfolio companies with operational support to professionalize their businesses by strengthening management capacity, worker skills, financial reporting, corporate governance, and social responsibility policies.
To manage the Fund, Leopard Capital has established an investment team comprised of Haitians, expatriate residents, and returning members of the Haitian Diaspora who have acquired skills abroad. The team combines experience in Private Equity, Investment Banking, Operations, Regulatory Compliance and Law. The team will be based in Port-au-Prince. The local investment team will be backed by Leopard Capital’s global team which has successfully invested in other frontier economies such as Cambodia and Laos.
Douglas Clayton, Leopard Capital’s CEO, commented: “We are pleased to launch Haiti’s first investment fund with the strong backing of three leading development banks. As investors we see attractive opportunities in helping Haitian businesses grow, while strengthening the country’s economic future. Leopard Haiti Fund’s success can show the world that Haiti is open for business.”
Jurgen Rigterink, FMO’s Chief Investment Officer commented: “After bringing energy to Haiti through the E-Power project, FMO will now bring growth capital to Haiti’s SMEs in order to increase economic activity, while adhering to the highest environmental and social standards. The resulting job creation will empower the Haitians to take their destiny in their own hands.”
