Sri Lanka’s First Private Equity Fund to be Set up by Calamander Group with a Targeted Internal Rate of Return of 30pct

08th May 2010, www.e-bizsrilanka.com

Calamander Group Pte, a Singapore-based investment company, has plans to create the first private equity fund in Sri Lanka. The private equity fund is designed to achieve high capital growth (with a targeted internal rate of return of 30%) by buying companies that ride the commodity boom, Calamander posted in its website.

Calamander plans to invest US $50 million which would comprise a major 40 percent in tea, 25 percent in rubber, 20 percent in ceramic and the balance 15 percent in coconut businesses.

‘An export-oriented commodity based private fund is the most risk averse play on the Sri Lanka growth story. The group believes that although the security political risks remain, the macroeconomic backbone of the Sri Lankan economy remains fundamentally attractive for the next five to ten years,’ the company said.

In the tea and rubber industries, Calamander plans to buy a number of tea/rubber factories in a specific district to gain economies of scale and also buy a tea trading house to distribute production. In the ceramic and coconut sector Calamander will develop new strategies for growth and operate as a medium sized player, the company outlined in its website.

‘Calamander selects investments by applying well tested investment models. We focus on companies that have strong growth prospects, with a special emphasis on sectors where Sri Lanka has a global competitive advantage,’ the website added.