SEAF Caucasus Growth Fund

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The EBRD is considering an equity investment of US$ 10 million in the SEAF Caucasus Growth Fund (the “Fund”). The proposed project will be the first institutional-quality private equity fund in the Caucasus. The Fund will provide debt, equity, and mezzanine capital to small and medium sized enterprises in Georgia, Armenia and Azerbaijan (the “Caucasus”) with the objective of achieving long term capital growth. The Bank’s participation will ensure that the Fund achieves a viable first closing to be able to execute the investment strategy. The transition impact and demonstration effects associated with this potential investment are expected to include: 1. Development of the private equity sector in the Caucasus by supporting the first institutional quality private equity fund with the potential to serve as a long-term provider of private equity capital for SMEs; 2. Providing valuable support to portfolio companies in developing their business strategies and implementing best practices in financial reporting, corporate governance, and transparency. SEAF Caucasus Growth Fund is a Cayman Islands exempted company with limited liability. The Sponsor of the Fund is Small Enterprise Assistance Funds, a not-for-profit corporation, incorporated in New York. The Bank will commit to invest the lesser of US$ 10 million or up to 25% of the Fund. The target size of the Fund is US$ 50 million. The Fund shall comply with the EBRD Performance Requirements 2 and 9, implement and comply with the EBRD Environmental and Social Procedures for Active Equity Investments and ensure investee companies comply with national environmental and Occupational Health and Safety standards. The Fund will be required to adhere to the EBRD's Environmental and Social Exclusion and Referral lists. Investee companies will be required to comply, at a minimum, with national requirements for environment, social health and safety, and labour standards. The Fund will submit an annual Environment & Social Report to investors and the IFIs combined Environmental and Social Exclusion list will be included into the legal documentation. The EBRD provided an equity commitment of USD 10 million to the SEAF Caucasus Growth Fund (the “Fund”). The Project supported one of the first institutional quality funds focused solely on providing finance to small and medium sized enterprises in Georgia, Armenia and Azerbaijan, with the objective of achieving long-term capital growth. The Bank’s participation ensured that the Fund was able to achieve a viable fund size to be able to execute the investment strategy. The Project is on track to achieving its transition impact related to market expansion, improved standards for corporate governance and business conduct, and demonstration effect of private equity financing in markets where the local private equity industry is at a nascent stage of development. None. Hubertus (Bert) J. van der Vaart E-mail: bert@seaf.com Tel: +1 (202) 737-8463 For business opportunities or procurement, contact the client company.