Thrust on private equity
Friday, 5 June 2009
FE Report
Bangladesh needs a clearer appreciation of the major issues on all sides for the private equity industry to develop effectively , said Ifty Islam, managing partner of Asian Tiger Capital Partners (AT Capital), in a presentation in the city Wednesday.
He also said Bangladesh is ready for private equity investment, which can play an important role in the country,
"We firmly believe that Bangladesh is ready for private equity, although it will take a process of education for both companies and local financial institutions as to the nature of private equity," Ifty, an investment analyst said in a seminar titled 'Private Equity in Bangladesh: Challenges & Opportunities'.
The seminar was organized on the occasion of visit to Bangladesh by Ms Anublia Srivastava, Managing Director, Asia, CDC Group, one of the largest Private Equity (PE) funds in the region.
Ms. Srivastava, who has been on a short visit to Bangladesh to explore and expand the potential of PE investment in Bangladesh was the key discussant in the seminar attended by a sizable group of leading entrepreneurs/ business executives representing the key business sectors of Bangladesh.
Private equity is medium to long-term finance provided in return for an equity stake in potentially high growth unquoted companies.
Ifty said Bangladesh remains a fundamentally capital-constrained economy.
Referring the World Bank's Second Investment Climate Report, he said access to finance is tight.
More than 40 percent of firms nationwide agree that access to finance is a major or severe obstacle to business, a higher percentage than the average for low and lower-income countries, and the highest in the region after Pakistan.
"As a result, firms in Bangladesh need to use internal savings to finance investment," Ifty said. "Private equity can meet such investment requirements."
Ifty said financial authorities would need to focus on the requirements and expectations for private equity investors in terms the regulatory framework that will govern private equity investments in terms of leverage, taxation and repatriation.
It may not necessarily require new private equity specific regulations, as has been the case in India, where the private equity industry has flourished largely within the existing regulatory framework for foreign direct investment, Ifty said.
Anubha Srivastava also spoke at the function.
Bangladesh needs a clearer appreciation of the major issues on all sides for the private equity industry to develop effectively , said Ifty Islam, managing partner of Asian Tiger Capital Partners (AT Capital), in a presentation in the city Wednesday.
He also said Bangladesh is ready for private equity investment, which can play an important role in the country,
"We firmly believe that Bangladesh is ready for private equity, although it will take a process of education for both companies and local financial institutions as to the nature of private equity," Ifty, an investment analyst said in a seminar titled 'Private Equity in Bangladesh: Challenges & Opportunities'.
The seminar was organized on the occasion of visit to Bangladesh by Ms Anublia Srivastava, Managing Director, Asia, CDC Group, one of the largest Private Equity (PE) funds in the region.
Ms. Srivastava, who has been on a short visit to Bangladesh to explore and expand the potential of PE investment in Bangladesh was the key discussant in the seminar attended by a sizable group of leading entrepreneurs/ business executives representing the key business sectors of Bangladesh.
Private equity is medium to long-term finance provided in return for an equity stake in potentially high growth unquoted companies.
Ifty said Bangladesh remains a fundamentally capital-constrained economy.
Referring the World Bank's Second Investment Climate Report, he said access to finance is tight.
More than 40 percent of firms nationwide agree that access to finance is a major or severe obstacle to business, a higher percentage than the average for low and lower-income countries, and the highest in the region after Pakistan.
"As a result, firms in Bangladesh need to use internal savings to finance investment," Ifty said. "Private equity can meet such investment requirements."
Ifty said financial authorities would need to focus on the requirements and expectations for private equity investors in terms the regulatory framework that will govern private equity investments in terms of leverage, taxation and repatriation.
It may not necessarily require new private equity specific regulations, as has been the case in India, where the private equity industry has flourished largely within the existing regulatory framework for foreign direct investment, Ifty said.
Anubha Srivastava also spoke at the function.