x Abu Dhabi, UAETuesday 16 January 2018

ING launches $500m fund in region

The global market meltdown has delayed its launch but investors still want exposure to the region.

NG Investment Management plans to go ahead with the launch of a US$500 million (Dh1.83bn) MENA Equities Fund despite fragile market conditions, according to the firm's regional chief executive, Grant Bailey. The flagship fund has been in development for two years and was planned for launch in the third quarter of this year, but was delayed."As markets were deteriorating in September and October, we delayed the launch slightly until after the US presidential elections when markets moved towards stability," said Mr Bailey. "We are committed to the strategy of having a flagship MENA equities fund and believe we have got the perfect market timing for a fund launch." Newly launched funds focusing on the MENA region include Bahrain based Unicorn Investment Bank's Excalibur MENA fund and Algebra Capital's Sukuk Fund, according to news and data service Zawya Dow Jones. Unicorn Investment Bank, based in Bahrain, had announced plans for the launch of a the Excalibur MENA fund in the fourth quarter of 2008, but has pushed the launch date to the first quarter of 2009. ING's regional chief investment officer, Farah Foustok, added that with political stability in the US, it was expected that by the first quarter of next year international investors would be looking increasingly at the Middle East, where growth was positive and fundamentals were strong. The firm's fund will be accessible to corporate, institutional and wealthy individual investors worldwide. Domiciled in Luxembourg, it will cover between 20 and 40 well-capitalised companies in the region. Pieter Hendriks, the firm's regional head of distribution, said the fund would be open to institutional investors from Nov 17. "The reason why we want to open the fund to investors next week is because there is a lot of interest from local investors who are eager to come back into the market in early 2009. This is also true of global investors from Europe and Asia as more and more is understood about the dynamics of MENA's equity markets," said Mr Hendriks. He added that private banking clients were early adapters to difficult market conditions and were looking closely at opportunities in the Middle East. The firm's fund manager, Yazan Abdeen, echoed the views on the rising interest in MENA's equity markets. "Global sentiment has affected people and they are nervous. It doesn't mean appetite for MENA is not there, it certainly is," said Mr Abdeen. "A lot of private banks who don't have MENA funds on their platform will be adding them." Funds focusing on the MENA region haven't been sheltered from the financial crisis over the past year, though the forecast is less stormy going forward.The EFG-Hermes MEDA fund is down 19.5 per cent year to date, and the firm's other firm focusing on the MENA region, EFG-Hermes Telecom Fund, is down 22.3 per cent. Shuaa Capital's Arab Gateway Fund is down 48.4 per cent. shamdan@thenational.ae