HANOI -- Vietnam-focused private equity firm Penm Partners expects slow-going for its fifth fund as the global economy reels from the effects of the new coronavirus, according to a senior executive.
The Danish firm hopes to raise about $150 million for its PENM V fund -- the same amount as its previous investment vehicle -- Managing Partner Hans Christian Jacobsen told DealStreetAsia.
"We were supposed to raise the fund by mid this year. But the coronavirus has caused a lot of uncertainties. So the end of this year or early next year would be more realistic," Jacobsen said. "In Europe, China and Vietnam, investors are putting on hold to see how it will play out."
Penm's limited partners include Danish pension fund PKA.
Jacobsen also expects Vietnam's investment scene to normalize in three to six months, given that the country has not been affected as much as China or Italy.
PENM V will continue to focus on Vietnamese consumer-related companies, Jacobsen added.
Besides new investments, the fifth fund will look to increase stakes in its existing portfolio. Jacobsen said the firm's current vehicle, PENM IV, could still make two or three more investments.
When it comes to new deals, Jacobsen said that valuations remain unrealistic. "Especially in the present situation, many companies have seen sales down by as much as 60%," he said.
Penm has invested in Vietnamese manufacturing, agriculture, foods, retail and services. Its portfolio includes Hoa Phat Group, Masan Group, Taseco Airs, GTN Foods, International Consumer Products and Loc Troi.
It has also concluded almost 20 investments, and closed out its past portfolio through initial public offerings and sales to strategic investors.
In 2017, it sold a stake in Masan to U.S.-based KKR for $100 million. Eight years earlier, Penm -- then known as BankInvest -- and TPG Growth announced a joint $50 million investment in Masan, in which TPG contributed $35 million.
"In the past, we sold [our portfolio companies] to European and U.S. investors as well as Vietnamese investors. Now, there is a lot of interest from Japan and South Korea. The exit environment is reasonable," said Jacobsen.
For the original story from DealStreetAsia, click here.
DealStreetAsia is a financial news site based in Singapore that focuses on corporate investment activity in Southeast Asia and India. Nikkei recently acquired a majority stake in the company.