SEE to re­main dis­tressed for 2-3 years

Financial Mirror (Cyprus) - - FRONT PAGE -

With some EUR 900 mln al­ready un­der man­age­ment, and tak­ing an eq­uity po­si­tion of over EUR 20 mln each time, the com­pany’s founders aim to raise their as­set strength and some­day reach the level of the clients they serve.

“This re­gion will con­tinue to re­main dis­tressed for the next 2-3 years,” said Sav­vas Li­a­sis, part­ner in the firm and chair­man of the award-win­ning af­fil­i­ate Alpen In­vest.

“Usu­ally we get the man­date from the own­ers them­selves, who are ei­ther in a dif­fi­cult sit­u­a­tion or need fresh cap­i­tal to grow. We would nor­mally take an eq­uity po­si­tion for 3-5 years, usu­ally for our clients that in­clude ma­jor fund man­agers or fund-of-funds in western Europe and the U.S.,” Li­a­sis said.

Po­ten­tial tar­get mar­kets in­clude Cyprus, Greece, Ser­bia, Slove­nia and Croa­tia, he said, which are mar­kets which are not yet sat­u­rated and where in­vest­ments in non-per­form­ing loan port­fo­lios are lu­cra­tive.

The spe­cialised teams at El­e­ments and the Slove­nia-based Alpen In­vest have helped the group po­si­tion it­self among the big­ger in­ter­na­tional play­ers, some whom used to be ri­val and now are their clients.

“Bank of Amer­ica man­aged to out­bid us on a deal we were work­ing on for six months. Now, they are our clients,” Li­a­sis said.

An­dreas Ge­or­gal­lis, Chief Oper­a­tions Of­fi­cer at El­e­ments, said that in most cases the own­ers stay on with a mi­nor­ity stake, while any­one from their 30-strong team, in Slove­nia or the of­fice in Cyprus, would as­sist to turn the com­pany around.

In June, El­e­ments Cap­i­tal Part­ners, along with the USbased in­vest­ment fund York Cap­i­tal Man­age­ment LLC, fi­nalised the pur­chase of re­ceiv­ables (and obli­ga­tions) against Is­tra­benz, one of the largest hold­ing com­pa­nies in Slove­nia, of ap­prox­i­mately EUR 46.7 mln from BAWAG, and banks be­long­ing to the Er­ste Group.

Is­tra­benz is a strate­gic hold­ing com­pany, with its shares listed on the Ljubl­jana Stock Ex­change since 1997. The core ac­tiv­ity of the hold­ing is in­vest­ment man­age­ment (strate­gic and port­fo­lio). The pur­chased amount of claims rep­re­sented 34% of Is­tra­benz’s over­all re­struc­tured fi­nan­cial debt.

“The pur­chase of re­ceiv­ables from Is­tra­benz will en­able us to ex­pand our ex­per­tise into the fields of tourism and energy, two sec­tors also cru­cial to the Cypriot econ­omy into which we are look­ing to ex­pand in the near fu­ture,” said Li­a­sis.

Speak­ing about re­ceiv­ing the award for Best Fund Man­age­ment Team in South Eastern Europe from Cap­i­tal Fi­nance In­ter­na­tional, Li­a­sis said that this con­firms Alpen In­vest’s po­si­tion as one of the lead­ing as­set man­age­ment com­pa­nies in south eastern Europe. In Fe­bru­ary, Alpen In­vest was de­clared the best Slove­nian fund man­age­ment com­pany for 2014 by the coun­try’s lead­ing fi­nan­cial news­pa­per Moje Fi­nance. Two of its funds – “Alpen.Emerg­ing” and “Alpen.De­vel­oped” – also re­ceived top rat­ings, while the man­agers of the two funds were named among the top five Slove­nian fund man­agers of the year.

“South eastern Europe is on the move, and the prospects for growth are con­stantly in­creas­ing. In this rapidly evolv­ing en­vi­ron­ment, we are de­lighted to have po­si­tioned Alpen In­vest as a ref­er­ence point for in­vestors, and to be achiev­ing recog­ni­tion for our ef­forts”, said Li­a­sis.

In their re­port, the CFI award judges in Lon­don ap­plauded Alpen In­vest – un­der Cypriot con­trol since 2014 – for putting place a num­ber of com­pre­hen­sive pro­cesses that “en­sure risk pro­files are prop­erly man­aged at all times”, and noted that the com­pany also “closely ad­heres to trans­par­ent in­vest­ment poli­cies that are cen­tred on client con­cerns and as­pi­ra­tions”. They also em­pha­sised the com­pany’s con­cern for in­vestors, not­ing that Alpen In­vest’s pro­fes­sion­als “strongly be­lieve that Slove­nian com­pa­nies presently be­ing pri­va­tised are sig­nif­i­cantly un­der­val­ued and thus of­fer ex­cel­lent short and medium term up­ward po­ten­tial”. This year’s award win­ners in­cluded Ger­man pharma Bayer, HSBC, PwC, and Baker & McKen­zie con­sult­ing firms and MetLife In­sur­ance.

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