There may be plenty of doom and gloom among private equity practitioners in the US and western Europe as a result of the global credit crunch that has all but dried up their cheap financing. In Russia, though, the mood among their peers is almost euphoric. "I am amazed by how relatively easy it is to raise money for a private equity fund in Russia," says Florian Fenner, managing partner at UFG Asset Management in Moscow, which is fundraising for its second private equity vehicle. UFG is looking to raise at least $500 million and expects to make a first close at least half that figure in May.
The firm’s optimism about raising private equity capital provides further evidence of the bullish trend in the industry in Russia. In another example, Renaissance Group announced at the end of March that it had raised $660 million within six months for its first private equity vehicle, having initially only targeted a $500 million total.
Expansion capital
Fredrik Ekman, managing partner and co-founder of Mint Capital in Moscow, which is looking to raise its third private equity fund in the autumn, says that over the past three years the potential deal flow for a mid-cap specialist such as Mint has definitely improved.