The Ministry of Economy of Bulgaria and the European Investment Fund (EIF) have concluded negotiations to launch a new investment programme, a combination of reflows from JEREMIE operations and EIF resources, to target investments in and alongside of venture capital, private equity funds investing in Bulgaria. The new investment programme, called InvestBG Equity, also aims to attract significant private and institutional capital to invest in the expansion and internationalisation of Bulgarian-based companies.
The InvestBG Equity Instrument is designed to support one of the strategic policy objectives of the Bulgarian Ministry of Economy of fostering investment sectors that create high value added and increase the overall competitiveness of the economy through the creation and development of high-growth and innovative SMEs by facilitating the access to equity financing.
The Ministry of Economy of Bulgaria, through the JEREMIE Holding Fund and EIF, will together commit up to EUR 110 million to this jointly developed programme. The InvestBG Equity is the first programme of its kind where JEREMIE reflows are to be invested in a joint framework with EIF managed resources for investments in support of Bulgarian companies.
The resources under the programme are expected to be allocated under two sub-windows:
- Commitments in venture capital and private equity funds investing in Bulgaria – up to EUR 100m
- Co-investments alongside with venture capital and private equity funds in Bulgarian companies – up to EUR 10m (plus EUR 10m guaranteed private co-investment)
The programme will be committed to 3 to 5 fund managers with experience in managing venture capital and private equity funds in Bulgaria as well as wider CEE region with the ultimate goal of catalysing more capital for Bulgarian companies.
Ten years since the launch of the JEREMIE initiative, EIF is very positive about the transformation of the Bulgarian venture capital and private equity landscape. Commenting on this initiative, EIF Chief Executive Pier Luigi Gilibert said “We are very pleased to launch this pilot instrument, which will enable the EIF and the Bulgarian government to further support the venture capital and private equity market in Bulgaria. This is an important milestone in our partnership with the Ministry of Economy as it will be the first ever programme where EIF will co-invest its resources under management alongside JEREMIE reflows in a dedicated fashion in the benefit of Bulgarian businesses.”
„Ensuring a minimum of EUR 35 m additional to the initially dedicated EUR 60 m national resources of the Bulgarian government through JEREME reflows under the InvestBG Equity is a major step in our continuous efforts to further improve the investment environment in Bulgaria and provide more options for the local businesses to grow internationally. The financial commitment of EIF to the instrument is a sign of confidence into the potential of the Bulgarian companies and economy in general”, commented Ms. Liliya Ivanova, Deputy Minister of Economy of the Republic of Bulgaria.
JEREMIE (Joint European Resources for Micro to Medium Enterprises) is a joint initiative launched by the European Commission (Directorate General Regional Policy) and the European Investment Bank group to improve access to finance for SMEs in the EU within the Structural Funds framework for the period 2007 – 2013. JEREMIE enables the EU Member States and Regions to put money from the structural funds and also national resources into holding funds that can finance SMEs in a flexible and innovative way.
JEREMIE Initiative in Bulgaria has so far financed close to 10,000 small businesses in Bulgaria with loans and equity investments of approx. EUR 900 million. Reflows from these operations are currently reinvested in new guarantee and equity instruments.
About the EIF
The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe’s micro, small and medium-sized businesses by helping them to access finance. EIF designs and develops both venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.
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