KUALA LUMPUR; DATUK Seri Nazir Razak, chairman of CIMB Group Holdings Bhd, is helping start a regional private equity fund that will seek as much as US$1 billion (RM4.19 billion), said people with knowledge of the matter.
Nazir will keep his role at CIMB, Malaysia’s second-largest bank, while acting as one of the fund’s five partners, according to the people. He will be joined by Kenny Kim, who previously worked under Nazir as chief financial officer of CIMB, said the people.
David Heng, who recently resigned from his role as senior managing director at Temasek Holdings Pte Ltd, would also help direct investments at the new fund, said the people.
The fund, which isn’t connected to CIMB, will be based in Singapore, according to one of the people. It plans to target investments in the consumer, technology, logistics and financial services industries in Southeast Asia.
Private equity deals in Southeast Asia have more than doubled to US$37.4 billion this year, from US$16.4 billion during the same period last year, according to data compiled by Bloomberg.
An investor group agreed in July to pay US$11.6 billion for Singapore warehouse operator Global Logistic Properties Ltd in Asia’s biggest-ever buyout, the data show.
“Nazir is well-respected and has a good team with him,” said Danny Wong Teck Meng, chief executive officer of fund manager Areca Capital yesterday.
“Their local connections and understanding of Southeast Asian business culture will give them an edge over other foreign funds. There are also better opportunities in this part of the world than elsewhere.”
Gita Irawan Wirjawan, who was Indonesian trade minister under the country’s last president, and former Philippine finance secretary Cesar Purisima, would also be partners at the new fund, said the people.
The five partners are planning to seek about US$700 million to US$1 billion from investors, according to one of the people.
Deliberations were at an early stage, and details could change, said the people.
A spokesman for CIMB declined to comment. A representative for Temasek said Heng would be leaving the Singapore state investment company at the end of this year to pursue other opportunities.
Nazir, 50, and the other four partners either said they had no comment or could not be reached for comment.
Southeast Asia has emerged as a strong manufacturing alternative to China, helped by lower labour costs, growing domestic demand and improvements in infrastructure.
Gross domestic product in Asean surged to US$2.6 trillion last year, about the size of the United Kingdom’s economy, from a mere US$37.6 billion in 1970.
Growth in Asean is seen at 4.9 per cent next year, with Myanmar, Vietnam and the Philippines posting the fastest expansions in the region, according to BMI Research. Bloomberg