Baring Vostok Capital Partners, a backer of Yandex, the Russian internet search firm that raised $1.3 billion in a US float this week, plans a new fund later this year, founding partner Michael Calvey told Reuters.
Baring Vostok would seek to raise $1.1 billion for its fifth fund, the same size as the last capital-raising in 2007 by the Russia-focused private equity partnership, which was set up in 1994 and landed its biggest coup with the Yandex listing.
Yandex shares leapt by 55 percent on Tuesday, their first day of trading on Nasdaq. Based on Wednesday's close, the business is worth $11.2 billion.
That's 750 times the value put on Yandex when Baring Vostok led an investor group that bought into the internet start-up in 2000, when it had revenue of just $72,000 and lost $2 million.
Calvey declined to comment on the Yandex float, citing disclosure rules. But he said that, with its existing capital now 60 percent invested, Baring Vostok was preparing the ground to launch the new fund late this year or early next year.
"It takes longer for any private equity firm to raise new funds these days compared to 2007, and we don't want to have a gap between funds during which we can't execute on new opportunities," the 44-year-old American said in an interview.
Calvey is the only non-Russian partner at Baring Vostok, which has a 19-company portfolio concentrated on fast-growing service sectors such as information technology, healthcare, retail, media and financial services.
Investments include online retailer Ozon.ru - in which Baring Vostok invested around the time of the original Yandex deal - outdoor advertiser Gallery and leasing firm Europlan.
It does have resource assets, including Russia's Volga Gas and Zhaikmunai in Kazakhstan, but prefers niche players and specialist equipment producers and avoids investments where it might clash with large state-controlled firms.
The strategy enables Baring Vostok to steer clear of Kremlin politics, where a perceived lack of transparency is often cited by foreign investors as a reason to keep away from Russia.
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Lofty Chile interest rates invite peso rally
SANTIAGO: Copper and oil price swings are buffeting Chile's peso, but renewed calm could spark a rally back to 3-year highs as robust growth and aggressive interest rate hikes stoke a new wave of capital inflows.
Chile's central bank surprised markets this month with a third straight aggressive 50 basis-point interest rate hike, bringing its benchmark rate to 5 percent compared to near-zero interest rates in the United States and Japan.
Foreign investors have flocked to Chile's rising returns, bringing net portfolio inflows of $1.4 billion in the first quarter, the country's biggest quarterly inflow of financial investments since at least 1996 according to central bank data.
The widening gap between Chilean interest rates and those in major developing countries has spurred carry traders, who borrow in low-yielding currencies such as dollars and yen to invest in peso-denominated assets. Investors can also make parallel bets with non-deliverable forwards (NDFs), a foreign exchange contract settled in dollars.
The implied yield on 3-month peso NDFs climbed as high as 4.56 percent last week from a January low of 1.50 percent, as the market gauge showed rising expected returns on Chilean assets compared to US borrowing costs.
The peso rallied 17 percent in the second half of last year, but has underperformed the rest of the region's major currencies this year, due to a $12 billion central bank intervention launched in January, the initial impact of which has already been erased.
Chile's peso firmed 0.4 percent on Thursday, gaining as the dollar fell against the yen and euro, to bid 469.6 per US dollar.
The Chilean peso is broadly stable against the dollar year-to-date, compared to a 2 percent gain in Brazil's real and the 5 percent appreciation of the Mexican peso. Longer-term investors have also been given a more attractive entry point for the peso as a spike in the cost of oil imports and a recent slide from life highs for Chile's main export copper have pulled the peso back from a new 3-year closing peak of 460.3 per dollar hit on April 29 - the highest level since the same date in 2008.
The peso has pulled off near one-month lows on Monday, helped by recovering copper prices after Goldman Sachs recommended clients open new long positions in copper, suggesting a recent sell-off may have run its course.
The peso's daily moves have an erratic connection with copper prices, but their monthly correlation is one of the exchange rate's strongest, most consistent drivers. Commodity price swings have done little to stop Chile's robust consumer-driven growth from appealing to investors.
Domestic demand in Chile surged nearly 15 percent in the first quarter from a year before, driving 9.8 percent economic growth from early 2010, when an earthquake set back the economy's rebound but increased the need for foreign capital.
Katia Diaz, an analyst at 4Cast in Washington, says Chile still needs repatriate dollar savings to help fund the state's $8.4 billion share of reconstruction after the quake.
The central bank held off monetary tightening following the disaster and joined the regional rate-hike cycle late but forcefully, raising its key rate by 450 basis points in the past year to combat mounting inflation expectations.
The bank has signalled the pace of future increases will likely be more gradual as the key interest rate reaches neutral levels. Central bank surveys show economists expect the rate to rise another percentage point by the end of the year.
A bank poll of traders released on Wednesday showed a broadly stable median forecast for the peso, as the regular survey has for much of the past year. Chile's 5 percent benchmark interest rate has already climbed far above reference rates in Japan, Europe and the United States, which remained at historic lows to boost tepid growth, although Chilean rates rank behind regional peer Brazil.
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