Italy’s biggest insurer Assicurazioni Generali said it has put over €300m a joint private equity fund to invest in central and eastern Europe, with further commitments planned.
In a statement on Monday, the insurer and PPF Group of the Czech Republic said the venture, PPF Partners, had launched its first fund with €615m in commitments.
Generali will have 27.5% of the venture and PPF 72.5%, the statement said. Generali has contributed about 50% to the first fund, Mel Carvill, who is moving from Generali to head the venture, told Reuters.
PPF Partners aims to launch further funds to reach €5bn of assets under management in five years.
“We’ve invested over €300m in the first fund already,” Carvill, now president and chief financial officer of PPF Partners, said in a telephone interview.
Of the 5 billion euros targeted, he added that “we certainly expect that more than half of that will come from outside investors,” which would be both local and foreign. He said there had already been interest from family businesses, pension funds and insurers, but declined to give any names.
Generali already has a joint venture in insurance with PPF Group which focuses on central and eastern Europe (CEE).
Carvill, who has left his position as vice-director-general at the insurer for his new post, said PPF Partners felt the area had good growth potential, though he stressed that each country was different.
“We believe in the CEE. We certainly think that these countries, although it’s a tough time at the moment, will have higher GDP growth than western Europe,” he said.
Carvill said the fund was looking at defensive sectors with investments already in waste management, energy, hotels and media companies.
The fund has invested in Prague Services municipal waste management company, Czech waste-to-heat company Termizo and Ukraine Cable TV, amongst others. Further details are available on its website, www.ppfpartners.com.
The fund will take “an active approach … involved in strategy and management,” Carvill said.
Reporting by Jo Winterbottom and Claudia de Lillo Ed; iting by Rupert Winchester