The EMF New Europe Insurance Fund, has had its first close, with total commitments of over USD 70 million. The EMF New Europe Insurance Fund will focus on investing in the insurance industry in CIS & non-EU European countries. The target countries include Albania, Armenia, Azerbaijan, Georgia, Belarus, Kosovo, Macedonia, Montenegro, Moldova, Serbia, Russia, Turkey and Ukraine.
The cornerstone investors of the fund are German insurance company Gothaer (USD 30 million), the Dutch development bank FMO, (USD 20 million) and the German development finance institution DEG (USD 20 million).
The fund intends to take majority stakes in both life and non-life insurance companies in the target countries.
“Economic growth in the fund’s target countries is above the global average, however the current economic situation has resulted in a scarcity of capital in the insurance sector as the international companies are not expanding and liquidity is therefore tight”, said Peter Lovas, CEO of EMF Capital Partners. He added: “The target countries have an insurance penetration which is below that of the EU member Eastern European countries and much lower than the more developed EU markets. The insurance sector in the target countries is projected to grow at a significantly faster pace than in the EU. The fund intends to create value in the portfolio companies by developing profitable product lines in an expanding market.”
In regions where insurance is still underdeveloped, such as in the target countries, households as well as businesses are frequently unable to obtain adequate insurance cover and are consequently exposed to serious financial loss. DEG and FMO (two of Europe’s biggest development finance institutions) are very pleased to provide their commitment to the fund and are confident that their support will draw in further institutional capital, promote enhanced standards and assist the accelerated development of the insurance sector in the region.
The fund sponsor is EMF Capital Partners and the fund administrator is the Aztec Group.
EMF Capital Partners was advised by Erna Moerdijk of Bureau Moerdijk (Amsterdam) and Mark Baldwin of Macfarlanes (London).
About EMF Capital Partners
Launched in 2012, EMF Capital Partners is a private equity firm dedicated exclusively to financial institutions in the emerging markets.
The firm has representation in London, Moscow and Warsaw (with Istanbul following shortly).
About Gothaer
With over 3.5 million members and premium income of 4 billion Euro, the Gothaer Group ranks among Germany’s major insurance groups and is one of the country’s largest mutual insurance associations. Gothaer’s customers are for the most part private individuals and medium-sized companies. Gothaer offers a wide variety of insurance products, not only in the personal area, but also for small and medium-sized companies, the self-employed and freelancers.
About FMO
FMO (the Netherlands Development Finance Company) is the Dutch development bank. FMO supports sustainable private sector growth in developing and emerging markets by investing in ambitious entrepreneurs. FMO believes a strong private sector leads to economic and social development, empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With an investment portfolio of EUR 5.9 billion, FMO is one of the largest European bilateral private sector development banks.
About DEG
DEG (DEG - Deutsche Investitions und Entwicklungsgesellschaft mbH) is the German development finance institution andone of the largest European development finance institutions. DEG is a member of KfW Bankengruppe. For 50 years, DEG has been financing and structuring the investments of private companies in developing and emerging market countries. DEG’s aim is to establish and expand private enterprise structures in developing and emerging countries, and thus create the basis for sustainable economic growth and a lasting improvement in the living conditions of the local population.
