WASHINGTON, D.C., March 15 -- The International Finance Corporation (IFC) has approved an equity investment of up to US$2.5 million in H&Q Philippine Ventures II (H&QPV-II) to help meet the continuing strong need for venture capital in the Philippines. With IFC's investment, H&QPV-II is set to extend 400 million (US$16 million equivalent) in financing for new investments in unlisted Philippine companies, mostly in basic industries, service export industries, technology transfers, and contract manufacturing. Hambrecht & Quist Philippines, Inc., a management and consultancy firm organized under Philippine laws, will manage the fund. Chief sponsors of this project are the Hambrecht and Quist Group (H&Q), based in San Francisco, and H&Q Asia Pacific, a subsidiary of H&Q in the Asia Pacific region. IFC previously invested US$2.3 million in H&Q Philippine Ventures I, the first professionally managed large venture fund in the Philippines, which started operations in April 1989. Also capitalized at 400 million (US$16
million equivalent), this fund has invested in 18 unlisted small and medium Philippine companies and is now 90 percent invested. According to IFC investment officer Mamta Shah, IFC's equity participation in H&QPV-II shows IFC's commitment to the growth of capital markets in the Philippines which suffers from a shortage of long-term financing. "We expect H&QPV-II to help develop the Philippines' nascent venture finance industry and mobilize scarce equity capital for small industrial enterprises that lack access to capital," Ms. Shah said. IFC, a member of the World Bank Group, is the largest source of financing for private sector projects in developing countries. (30)
