Tue | Aug 22, 2017

Portland fund invests in fifth venture

Published:Friday | May 5, 2017 | 5:00 AMSteven Jackson

Portland Private Equity, chaired by Michael Lee-Chin, has poured US$17 million into financing the merger of two iconic restaurant chains in Colombia though its Caribbean Fund II.

The deal took the form of equity and debt participation in the creation of a new entity known as Grupo IGA, resulting from the merger of Inmaculada de Guadeloupe y Amigos CIA and Grupo Conboca. It includes restaurant brands Andres Carnes de Res, Kokoriko, and Mimo's.

The deal was Portland Caribbean Fund II's fifth investment. Latin American-based MAS Equity Partners also participated in the deal, but the size of its investment was not disclosed.

"Portland Private Equity applies a consistent methodology to its investment process and evaluates investment opportunities across several key dimensions. Grupo IGA evaluated very well against these dimensions which include a quality business," said Douglas Hewson, managing partner at Portland Private Equity, in response to Financial Gleaner queries.

"Andres Carne de Res is a globally renowned brand and unique. Kokoriko and Mimo's are long-standing, well-recognised brands in the Colombian market," he said.

Hewson added that Grupo IGA operates a network of eateries in about 42 cities in Colombia.

The restaurant chains were consolidated on March 17, but only announced in late April by stakeholders in Colombia.

"Portland Caribbean Fund II invested approximately US$17 million," Hewson said. "We believe the best way to maximise investment returns is to build long-term growth businesses. When successful in this regard, the business will present ample opportunities to monetise returns for investors in line with the institutional mandate of Portland Caribbean Fund II."

The chains wanted the capital in order to expand as well as to strengthen their position in the market. Under the deal, the founding shareholders of Andres Carne de Res, Kokoriko and Mimo's will remain owners, but their precise shareholding post-merger was not disclosed.

Portland Private Equity said on its website at the time that it was introduced to MAS Equity Partners, a Colombian private equity firm, by one of its limited partners back in 2010.

In relation to the current transaction: "MEP invited Portland to participate in the creation of Grupo IGA through the merger of two of its portfolio companies," said Portland.

Portland Private Equity is a private equity fund manage-ment company currently focused on private equity growth opportunities in the broader Caribbean region through its management of the AIC Caribbean Fund and its successor, Portland Caribbean Fund II.

Portland raised over US$200 million for Caribbean Fund II. The investor base for Fund II comprises financial institutions, pension funds, and insurance businesses.

Fund II's other investments comprise: CVBI in January 2015 at US$30 million, IEH Penonome Holdings in January 2015 at US$15 million, Clarien Group Limited in April 2016 at US$10 million, and InterEnergy Holdings in December 2016 at US$25 million.

With the IGA deal, the investments to date amount to US$97 million.

The fund is focused on making growth equity invest-ments in high-quality, scalable businesses. Fund II's geo-graphical mandate covers the Caribbean Basin, incorporating the Caribbean, Colombia and Central America.

steven.jackson@gleanerjm.com