Yangzijiang Financial, Heliconia team up to invest up to S$150 million in SMEs

SINGAPORE-LISTED Yangzijiang Financial will partner Temasek-backed Heliconia Capital to invest in Singaporean and South-east Asian small and medium-sized enterprises (SMEs), through a fund with a target size of up to S$150 million.

Yangzijiang Financial will contribute S$80 million to the Heliconia Generation Fund Limited Partnership, as the anchor limited partner, it said in a Tuesday (Nov 22) bourse filing. Investments may be structured in the form of equity, debt and/or hybrid debt-equity structures, it added.

The fund intends to invest in promising SMEs with a focus on Singapore and Vietnam to catalyse more capital for them, co-investing alongside other funds managed by Heliconia such as the SME Co-Investment funds.

“Heliconia focuses on investing in growth-oriented SMEs. Some criteria used in identifying its investments include a strong market position, sustainable competitive advantage, competent management, and the potential to be a significant player regionally or globally,” Yangzijiang Financial said.

Vincent Toe, chief executive officer and chief investment officer of Yangzijiang Financial, said: “SMEs form the critical pillar of the economic system of every country in South-east Asia. With the fund focused on investing in promising small and medium businesses in the region, there is a plethora of growth opportunities that we can target.”

Derek Lau, Heliconia’s chief executive officer, said: “This is in line with our overall co-investment objective where we can leverage more networks... Partnering like-minded investors such as Yangzijiang Financial will add value for our investee companies.”

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Shares of Yangzijiang Financial closed at S$0.34 on Tuesday, down S$0.005 or 1.5 per cent, before the announcement.