Evolvence plans to raise $150m for credit fund

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Evolvence CapitalEvolvence Capital, the Dubai-based investment house, aims to raise $150 million (Dh551m) by the end of this year for its newly-launched open-ended credit fund, its chief executive told Emirates Business.

The fund that was launched in May this year is currently being run on proprietary money, and the group has not yet gone ahead to the markets with it, said Khaled Al Muhairy.

"We are currently running the fund on our own money and are testing it. But then, this is an open-ended fund and we expect to raise finances by December. We expect to raise about $150m," said Muhairy.

Earlier announcing the Evolvence Credit opportunities fund in March this year, Muhairy said the fund hopes to raise $100m for its first closing.

He sees activity picking up in the Gulf after Ramadan. "We see activity picking up later this year. Confidence in the region comes from oil prices and they are rising," said Muhairy.

On a broader spectrum, the Gulf accounts for half of the capital raised by the company. "For our source of capital, the ratio of international to Gulf investors ranges between 60:40 and 50:50," Muhairy said.

He said the foreign investors are mainly from the Western countries.

The company also runs an office in New York to tap North American investors.

Khaled sees opportunities in the credit markets in the region. "I like the credit market. There is a lot of opportunity in the credit market. We see attractive papers on both private and sovereign levels," Muhairy said.

Muhairy said he finds the papers of sovereign institutions in Abu Dhabi and Qatar attractive.

The fund has been structured as a hedge fund and targets average annual returns of 20 per cent, he had earlier said in an interview to Dow Jones.

Muhairy said the UAE Government's move to guarantee debt instruments including bonds issued by UAE national banks will have a strong impact on the market sentiments.

"I think the banks reflect the general sentiments of an economy. Improved sentiments mean that they can attract deposits. They need to attract more money in the next few months to reduce the loan deposit ratio. That will help them fight off the crisis," said Muhairy.

Evolvence CapitalEvolvence Capital, an almost decade-old group traditionally invests in private equity, real estate and hedge funds. In India where the company has a strong presence, it invests directly into pharmaceutical firms, said Muhairy.

The company has been investing through its partners into infrastructure projects in India and into oil companies in the Gulf, he added.

By Shashank Shekhar

© Emirates Business 24/7 2009