how to encourage greater private equity investment in latin america development of non-bank...
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How to Encourage Greater Private Equity Investment in Latin America
Development of Non-Bank Financial
Institutions in Latin America
December 5, 2002
J. Scott Swensen
An IntroductionDeutsche Bank
Total assets exceeding €918 billion (1)
Market Capitalization of €49 billion (1)
Comprehensive range of investment banking services
Asset management business has €1 trillion in assets
DB Capital Partners, Inc.
Deutsche Bank’s private equity platform
Offices in U.S., Europe and Asia
Over 100 professionals
17 year history of private equity investing
Approximately €10 billion in private equity business
Investment manager for Latin Power Funds
As of December 31, 2001. (1)
Latin Power FundsScudder Latin American Power Fund I
Formed 1993
$100 million of capital
7 projects in 5 countries
Scudder Latin American Power Fund II
Formed 1998
$157 million of capital
9 projects in 7 countries
Latin Power Fund III
Illiquid investments in unlisted equity securities
Can be minority or majority position
Can be provided by strategic investors or funds
Different types:– Venture Capital
– Growth
– Buyout
– Mezzanine
– Vulture
What is Private Equity?
Who Invests in Private Equity Funds?
Other
Banks
Individuals
Endowments &Foundations
InsuranceCompanies
Pension Funds
Why Would a Developing Country Want to Encourage Private Equity Investors to Invest in Their Country?
Provides capital that is not available locally
Provides growth capital to create jobs
Stable capital vis-à-vis portfolio investments
Good timing match with pension fund and some insurance company liabilities
What Do Private Equity Investors Look For?
Politically stable & economically growing country
Transparent & stable environment:– Legal– Taxation– Regulation
Ability to exit investments
Ability to repatriate capital
Manageable currency risk