HORIZON CAPITAL GROWTH FUND IV, L.P
Status: Approved investmentWhy disclosure?
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In case of questions, please contact us at disclosure@fmo.nl
Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
Horizon Capital Growth Fund IV, L.P. (the “Fund”, “HCGF IV”) is a private equity fund investing in Ukraine and Moldova, managed by Horizon Capital (the “Fund Manager”). FMO has an existing relationship with Horizon Capital, having invested in all four of the private equity funds managed by Horizon Capital and established to date (Emerging Europe Growth Fund I, II & III and Horizon Capital Growth Fund II). FMO is investing USD 20mln at HCGF IV’s first close.
What is our funding objective?
HCGF IV has been established to invest primarily in fast-growing, export-oriented, asset-light companies that leverage Ukraine’s competitive cost base to generate global revenues. In addition, the Fund may also seek out select domestic champions with potential to grow from local to regional market leaders. Sectors will include IT, e-commerce, innovative retail, consumer goods and fintech. The funding objective is to support the Fund in reaching its target size of USD 250mln.
Why do we fund this investment?
Ukraine has a large, talented, and competitive labour force, both for IT and skilled manufacturing. Ukraine and Moldova are experiencing strong demand for growth-stage capital in both technology and traditional sectors. By participating in the Fund’s first closing, FMO will send a positive signal to other potential Limited Partners. FMO will thus play a catalysing role in helping the Fund attract other investors (DFIs and private investors) and reach its target size and objectives. Through its commitment, FMO will also support the Fund Manager in contributing to Ukraine’s economic recovery and ensuring that local businesses have access to growth capital, thus remaining resilient, agile and continuing to thrive, despite the context of the ongoing war.
What is the Environmental and Social categorization rationale?
Due to the current situation in Ukraine and associated contextual risk, HCGF IV has been categorized as Category A in accordance with FMO’s Sustainability Policy. Based on the Fund’s portfolio and investment strategy the actual categorisation would have been lower. E&S risks will vary from investment to investment, but key issues are mainly related to IFC Performance Standards (PS) 1: Assessment and Management of Environmental and Social Risks and Impacts, IFC PS2: Labor and Working Conditions (inc. security issues), and IFC PS3: Resource Efficiency and Pollution Prevention. The Fund Manager has dedicated ESG staff and a high quality and well-functioning Environmental and Social Management System (ESMS) in place based on IFC PS, which has been established with support from an external consultant and updated to fit the current situation in-country. For all assets, compliance with local regulation and with IFC PS framework is required. FMO will continue to engage frequently with the Fund Manager to monitor and provide feedback on the Fund’s E&S performance and their handling of contextual risk.
More investments
| Date | Total FMO financing |
|---|---|
| 9/26/2022 | USD 5.00 MLN |
| 9/26/2022 | USD 7.50 MLN |
Sub investments
Disclaimer
This data is updated annually so some investments might no longer be in FMO’s portfolio, while some newer investments may not yet be shown.
| Name | Country | Region | Sector |
|---|---|---|---|
| Preply, Inc. | Ukraine | EUROPE & CENTRAL ASIA | Diverse Sectors |
- Region
- Europe & Central Asia
- Country
- Ukraine
- Sector
- Infrastructure, Manufacturing and Services
- Publication date
- 8/19/2022
- Effective date
- 9/26/2022
- Total FMO financing
- USD 7.50 MLN
- Funding
- MASSIF
-
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - A