CEE/CIS

An Overview of Trends in Select Sectors and Markets July 2008

C
overage of the Central and Eastern Europe (CEE) and Commonwealth of Indepen- CEE/CIS Snapshot
dent States (CIS) markets often mistakenly conveys homogeneity—a monolithic
Central and Eastern Europe (CEE)
“emerging Europe.” This brief covers a range of markets under the rubric of CEE includes:
and CIS, however with the acknowledgement that these “regions” remain fragmented, Latvia
with a core of large, more mature markets coupled with several smaller developing PE Lithuania
markets. Estonia
Czech Republic
Among the CEE markets, more nuanced treatment in the wake of the first wave of Acces- Hungary
sion reflects the reality that “CEE” subsumes several discrete investment environments. Poland
Slovakia
Poland—with 40% of GDP and population among the Accession countries—has captured Romania
the majority of private equity investment to date. However, private equity investors are Bulgaria
increasingly finding opportunities in markets throughout the region, with the Baltic coun- Albania
Slovenia
tries and Southeastern Europe emerging as the next frontiers.
Croatia
The inclusion of Russia among the BRICs obscures the distincitviness of the Russian pri- Bosnia and Herzegovina
Serbia
vate equity market, over a decade in the making. While Russia continues to draw the bulk Montenegro
of investment within the CIS markets, remarkable economic growth in the markets of Republic of Macedonia
Ukraine and Kazakhstan is encouraging investors to broaden their scope within the CIS. Kosovo
Turkey
Perceptions about investment risk in CEE and CIS markets have improved. But the no-
The Commonwwealth of Independent
tion that Accession in the CEE markets translates to uniform harmonization with EU stan-
States (CIS) includes:
dards is misplaced. Enforcement of legal protections and treatment of investors still var-
Armenia
ies from country by country. Furthermore, while robust natural resource-driven economic Azerbaijan
growth has given birth to an emerging consumer culture in the CIS countries, these mar- Belarus
kets remain relatively uncrowded due to remaining challenges in sourcing and managing Georgia
Kazakhstan
continued on page 2
Kyrgyzstan
EU Accession and Eurozone Enlargement Timeline Moldova
Country EU Accession Euro Adoption Date Russia
Tajikistan
Czech Republic 2004 2012—14 Turkmenistan
Estonia 2004 2011 Ukraine
Hungary 2004 2014 Uzbekistan
Latvia 2004 2012—13 (Markets in bold indicate core markets attracting the
majority of private equity investment to date)
Lithuania 2004 2011
Poland 2004 2012—13
Slovakia 2004 2009
Bulgaria 2007 2012
Romania 2007 2014
Slovenia 2004 2007
Turkey 2013* -
Macedonia cand. -
Croatia cand. -

© 2008 Emerging Markets Private Equity Association 1

 EMPEA Insight: CEE/CIS
investments. The good news is that fund managers operating
locally across the CEE and CIS countries see these markets as
underinvested, and the higher risks relative to Western Europe
are still offset by the possibility of higher returns.
Fundraising
Capital commitments for private equity in CEE and CIS steadily
increased from US$2.2 billion in 2003 to an outlier US$14.6
billion raised in 2007. The unusually high figure in 2007 can be
attributed to Marfin Investment Group’s US$7 billion close and a
US$2.1 billion close by MidEuropa Partners. Following multiple
record-breaking fund closes in 2007, fundraising is down in the
first half of 2008. Funds focused on CEE and CIS markets raised
US$2.5 billion through June 2008, versus US$3.6 billion raised
in the same period in the previous year. However, the region
has attracted a host of new fund managers seeking capital —29
funds are seeking to raise as much as US$10.2 billion for invest-
ments across CEE and CIS as of July 2008.
Fundraising for CEE
Veteran fund managers with regional mandates have amassed
ballooning pools of capital: Mid Europa closed US$2.1 billion
Mid Europa III in 2007, and Advent International closed US$1.6
billion Advent Central & Eastern Europe Fund IV in April 2008.
While regional CEE funds have expanded in size and investor
base, country-dedicated and subregional funds are also grow-
ing, most notably in Turkey. Turkey’s private equity industry is
undergoing a renaissance, with funds raising US$1.1 billion in
2007 after several years of relative inactivity. New Turkey-dedi-
cated funds include Actera Partners Fund I with US$475 million
and Turkven’s Turkish Private Equity Fund II with US$428 million
in committments.
EMPEA Insight
Editorial Director Jen Choi
choij@empea.net
Writing and Research Harrison Moskowitz / Sean Michaels
moskowitzh@empea.net / michaelss@empea.net
Production Manager Cristiane Nascimento
nascimento@empea.net
About EMPEA
The Emerging Markets Private Equity Association is a broad-based
membership organization founded in 2004 that focus on the emerg-
ing private equity markets of Africa, Asia, CEE, Russia/CIS, Latin
America, and the Middle East.
2 © 2008 Emerging Markets Private Equity Association
July 2008
Fund managers are also increasingly targeting investments
across Southeastern Europe. In 2007, Bedminster Capital Man-
agement closed its US$200 million Southeastern Europe Equity
Fund II, and Marfin Investment Group closed a US$7 billion fund
that will invest in the Balkans and Turkey.
As the sophistication of CEE private equity markets grows, es-
tablished local players are being joined by US and Western Eu-
ropean fund managers. Several GPs have set up operations in
Warsaw and are developing local teams, among them UK-based
Bridgepoint and 3i and US firms The Carlyle Group and CVC
Capital Partners.
Fundraising for Russia and CIS
Russia experienced a breakout year in 2007, when capital com-
mitments grew to a record high of US$ 1.8 billion, led by Baring
Vostok’s US$1.45 billion Baring Vostok Private Equity Fund IV.
The Russian private equity market has long been both very local
and relatively uncrowded, but that is gradually changing.
Western European and US-based firms are beginning to enter
the Russian landscape. In May 2008, Nordic-based asset man-
agement firm CapMan signed an agreement to acquire private
equity firm NORUM along with its 13 private equity professionals.
At the time of the acquisition, the firm was raising NORUM Rus-
sia Fund III with a target of €150 million. The fund has raised
€88 million and will now operate under the name CapMan Rus-
sia Fund. TPG, which recently bid on two headline-grabbing
transactions in Russia, set up operations in Moscow in 2007.
Mint Capital, a Scandinavian private equity firm operating in
Moscow with US$150 million under management, has closed
two funds investing primarily in companies located around the
city and intends to raise a larger successor fund later this year.
Belgium-based GIMV, which launched the US$100 million Eagle
continued on page 3
Advertising Opportunities
EMPEA Insight, available free of charge to members, offers
readers an overview of the data and drivers behind investment
trends in emerging markets private equity. Each issue of EMPEA
Insight provides an opportunity for a single exclusive back page
advertisement. Issue-specific placements are on a first come, first
served basis. Upcoming issues include: the Middle East, India,
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July 2008
EMPEA Insight: CEE/CIS

Russia Fund in 2006, signed a partnership agreement with KBC EMPEA Survey of LP Interest: Current vs. Projected
Private Equity this year to create a new company, Eagle Capital Investment Strategy, CEE/Russia and CIS
Partners, which will invest EUR10 million per year in medium-
sized Russian companies.
100%
87%
Domestic private equity shops accustomed to competition from

% Respondents Investing
80% 75%
oligarch-run industrial groups are also being joined by a plethora 61% Current Strategy
60% 57%
of local investors flush with cash-generating business looking to Projected
40%
invest in smaller private equity-style deals. Strategy (3-5 years)

20%
Within the CIS, Russia continues to hold the core, but the scope
0%
of funds is expanding to Ukraine and Kazakhstan, the largest
2007 Survey 2008 Survey
and fastest growing among CIS markets. Russian fund manag-
Source: EMPEA
ers such as Baring Vostok and Alfa Capital Partners are consid-
ering investments outside of the Russian Federation.
The European Bank for Reconstruction and Development
Fund managers Aureos Capital and Mint Capital Advisers have
(EBRD), which has played a catalytic role throughout private eq-
recently launched funds focused exclusively on investments in
uity’s development in Emerging Europe, remains the leading LP
CIS countries—Mint Capital III was launched this year with a tar-
for funds dedicated to CIS countries. But government-backed
get of US$250 million, and Aureos Central Asia Fund held a first
funds are emerging as another source of capital. State funds
close of US$50 million in 2007. Ukraine’s private equity market,
are channeling natural resource-driven wealth into investments
while still small, continues to grow. Ukraine-based Horizon Capi-
intended to diversify economic growth beyond oil and gas. Ka-
tal is raising a US$300 million Emerging Europe Growth Fund
zyna Sustainable Development Fund teamed up with EBRD to
II, which will predominantly invest in Ukraine. Kazakhstan is
create the Kazakhstan Growth Fund aimed at strengthening
beginning to emerge as a destination for private equity. Sigma
private companies in non-extractive industries in Kazakhstan.
Bleyzer, active in Ukraine since 1996, closed Sigma Bleyzer V in
In Russia, the Kremlin created the Russian Venture Company
December 2007. The fund, oversubscribed at US$221 million,
(RVC), a federal state fund of venture funds with US$560 million
is targeting investments in Kazakhstan.
that provides low-cost financing to early stage innovative compa-
Sources of Capital nies. In March 2006, the government of Azerbaijan created the
Azerbaijan Investment Company to invest state capital in non-oil
Institutional investor interest has increased steadily every year
sector companies.
according to EMPEA’s 2008 LP Survey. Allocations to CEE/CIS
funds rank second only to Asia in emerging market PE strate-
gies, with 75% of respondents expecting to invest there within Investment
the next five years. More than 37% of investors rated CEE as
According to the European Venture Capital Association (EVCA),
the most attractive private equity market, with 11% choosing
private equity investment in the EU member CEE markets grew
Russia/CIS.
more than five-fold between 2003 and 2007. Hungary, Poland,
The limited partner base for funds in CEE and CIS has been to and Romania accounted for 66% of private equity deals within
date primarily European, but funds are increasingly attracting the EU member countries in the CEE in the last two years. As
commitments from beyond Western Europe. Advent Internation- of June 2008, investment volume had surpassed US$6.1 bil-
al’s fourth fund for the region included allocations from at least lion with 135 transactions in Central and Eastern Europe this
two American pension funds. Of the 60 LPs in Mid Europa’s year, registering an average investment size of US$157 million
Fund III, half were American, Asian or Middle Eastern investors. according to Capital IQ. Reflecting the increasingly localized na-
Marfin Investment Group’s watershed US$7 billion Southeast- ture of investing in CEE, firms based within the region accounted
ern Europe fund was raised through a public listing on the Ath- for more than half of the total deal value.
ens Stock Exchange.
continued on page 4

© 2008 Emerging Markets Private Equity Association 3

 EMPEA Insight: CEE/CIS July 2008

The growing sophistication of the CEE markets is exemplified by
a trend toward later-stage investments and increasing use of
leverage. An analysis of the EBRD’s CEE funds portfolio reveals
that buyouts combined with secondary purchases (sales be-
tween private equity firms) represented 71% of total investment
value in 2006 overtaking the share of growth capital. Growth
capital investments remain in the majority of CIS countries, ac-
counting for 70% of total investment value in 2006.
Use of Leverage
In recent years, a growing number of private equity transactions
in CEE have included the introduction of leveraged finance. In
Poland, industry insiders have estimated that a typical mid-mar-
ket transaction generally involved as much as 50% debt prior to
August 2007.
A 2008 investor sentiment survey by C5 and Squire Sanders
revealed that more than half of investors and industry advisers
saw tightening credit markets somewhat or significantly impact-
ing the availability of leverage in the CEE markets. Financing
for large deals remains beyond the capacity of most local banks,
although a wave of banking consolidation has made leverage
generally more available. In recent months, accessing debt has
become problematic for transactions of size that dictate reli-
ance on North American or European banks.
Despite a slowdown in large buyouts, middle market deals in
CEE appear to be going strong. Local sources have expressed
that overall deal levels are not off. In fact activity in medium-
sized investments is up thus far in 2008. In addition, some large
deals are still occurring. In February 2008, a consortium led by
BC Partners invested US$3.3 billion to acquire Migros Turk, a
Turkish supermarket chain, financed with debt from local Turk-
ish banks. Ares Life Sciences and Merrill Lynch Global Private
Equity bought Euromedic, a Hungary-based medical testing
company, for US$1.5 billion in June 2008.
While a handful of notable transactions in Russia in recent
months by European and US private equity firms have illustrat-
ed that leveraged buyouts are feasible, leverage is still seldom
used in CIS deals. The first leveraged buyout in Russia occurred
in October 2007, when Lion Capital acquired juice-maker Nidan
Soki for reportedly over US$500 million. This landmark trans-
action was followed by Lion’s acquisition of alcoholic beverage
producer Russian Alcohol Group from local private equity firm
Industrial Investors in July 2008. More recently, after its US$1.4
billion offer for Russian grocery chain Seventh Continent was
rejected, TPG quickly rebounded by acquiring Russian pharma-
ceutical distributer SIA International ZAO in an all-equity transac-
tion of approximately US$800 million.
Other than a few marquis deals, however, Western-style LBOs
have been virtually non-existent in CIS markets. According to
the C5/Squire Sanders survey, 58% of CIS investors claimed to
never or only occasionally use leverage in their deals.
Sector Trends
Tremendous economic growth averaging over seven percent
in 2007 is driving private equity investment trends in CEE and
CIS markets. Within CEE, Lithuania, Slovakia and Bulgaria have

continued on page 5
Sampling of Recent CEE/CIS Deals

Fund Manager (s) Company (US$M) Sector Market Date

Advent International LaborMed 177 Pharmaceuticals Romania Feb. 08
Dragon Capital Chumak 38 Food/Beverage Ukraine Mar. 08
Marfin Investment Group Sunce Koncern d.d. (“Sunce”) 235 Tourism Croatia Mar. 08
J&T Private Equity Czech Energy Holding (CEH) ND Energy Czech Republic Mar. 08
Euroventures Ukraine Fund II, Euro Leasing ND Banking Ukraine Apr. 08
Ukraine Opportunity Trust
PPF Investments Oriel Resources 271 Industrials Russia Jun. 08
Galt & Taggart Capital mGroup ND Retail Georgia Jun. 08
Icon Private Equity Delta Bank 350 Financial Services Ukraine Jun. 08
TPG SIA International ZAO 800 Pharmaceuticals and Russia Jul. 08
Biotech
Lion Capital Russian Alcohol Group ND Food and Beverage Russia Jul. 08
The Carlyle Group TVK Shipyard ND Industrials Turkey Jul. 08
Source: EMPEA

4 © 2008 Emerging Markets Private Equity Association

July 2008
the highest growth rates, and Czech Republic and Slovenia are
among those with the highest per capita GDP. Among CIS coun-
tries, Russia, Kazakhstan and Ukraine enjoyed strong 2007 GDP
growth (Russia: 8.1%, Kazakhstan: 8.5%, and Ukraine: 7.3%)
and continue to lead the CIS region in terms of GDP per capita.
In Russia, wages rose more than 30% between 2000 and 2006,
and per capital GDP is expected to grow to US$12,000 in 2008,
on par with Poland.
Investors are responding to a surging middle class across
the CEE and CIS markets by channeling investment into con-
sumer goods, retail, communications, healthcare and financial
servic¬es sectors. Among investors pursuing a retail strategy,
Penta Investments acquired Russian supermarket chain Semya
for US$200m—following on the May 2007 purchase of conve-
nience store chain Zabka. Moscow-based Baring Vostok recent-
ly announced it would seek opportunities in Kazakhstan’s retail
sector.
Technology, media, and telecommunications remain strong sec-
tors for investment. In May 2008, a consortium of firms that
included Innova Capital bought 100% of GTS Central Europe,
a leading pan-CEE telecommunications service provider, with
€400 million in revenues in 2007. Providence Equity Partners
invested US$200 million in Ukraine broadband operator Volia
Cable in December 2007.
Healthcare has also emerged as a sector of interest in CEE
mar¬kets in recent months, specifically in drug makers and
distributors, and healthcare operating companies. Mid Europa
Partners completed its third deal in Poland’s growing health-
care sector, investing an estimated US$108.9 million in medical
clinic chain LIM Centrum Medyczne in April 2008. Pharmaceuti-
cal deals in the first half of 2008 have included Enterprise In-
vestors’ US$54 million injection for pharmaceutical distributor
PharmaSwiss, and Advent’s April 2008 acquisition of Romanian
drug producer LaborMed Pharma. Turkey’s healthcare sector is
drawing capital from Middle East investors interest in “soft infra-
structure,” such as Abraaj Capital, which invested in Acibadem
Health Services, a hospital services operator, in April 2008.
The sector profile of investments within Russia is in part the
function of government restrictions on sectors open to foreign
investment. Oil and gas-related companies, accounting for 20%
of Russia’s GDP, remain off-limits. Russia’s new law on foreign
investment, which requires government approval for all foreign
investors seeking to buy more than a 50% stake in a company in
© 2008 Emerging Markets Private Equity Association
EMPEA Insight: CEE/CIS
Number of Investments in CEE/Russia by Sector
(Jan. to June 2008)
Energy
Telecommunication Services
Healthcare
Utilities
Other
Materials
Information Technology
Consumer Staples
Industrials
Consumer Discretionary
Financials
0 5 10 15 20 25 30
Source: Capital IQ
one of 42 strategic sectors (e.g. oil and gas, aerospace, media
and telecoms), came into force in May 2008.
While a significant source of deal flow in 1990s, privatization has
since diminished in importance in the original accession coun-
tries of Poland, Hungary and the Czech Republic. State-owned
assets are attracting greater attention elsewhere, with varying
degrees of success. In 2007, the Blackstone Group’s bid for
Latvian state-owned telecommunications company Lattelecom
was rejected in favor of a share-swap between the government
and Teliasonera, a Nordic telecommunications company with a
stake in Lattelecom. Ongoing liberalization programs in Turkey
in preparation for EU accession are expected to provide opportu-
nities as well, although the rejection of CVCI and Cinven’s recent
bids for state-owned tobacco monopoly Tekel in favor of a British
strategic investor demonstrated that challenges remain.
Exit Trends
Trade sales continue to play a central role in CEE and CIS. Ac-
cording to EVCA, 41% of the total number and 60% of the total
value of CEE PE-backed exits in 2007 were trade sales. The
EBRD, reported that trade sales accounted for approximately
40% of the institution’s portfolio in 2006.
In June 2008, Warburg Pincus sold its stake in Euromedic, a
Hungary-based medical testing company, to an Ares Life Scienc-
es and Merrill Lynch Global Private Equity consortium in a deal
valued at US$1.5 billion. In August 2007, Agribusiness Partners
completed its US$144 million exit from Chicken Kingdom, a fully
integrated Russian producer of fresh and frozen poultry prod-
continued on page 6
5
 EMPEA Insight: CEE/CIS July 2008

Average Returns for CEE Private Equity Funds (As of December 2007)
80
1 Year
70
3 Year
60

5 Year
50

40 10 Year

30

20

10

0
Dec-03 Jun-04 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Dec-07 Source: Cambridge Associates

ucts, through a sale to leading Russian meat processor OJSC
Cherkizovo. In May 2007, Horizon Capital’s Emerging Europe
Growth Fund (EEGF) sold its controlling stake in Shostka City
Milk Plant to French dairy company Fromageries Bel S.A., report-
edly achieving a gross 5.9 times return and 470% IRR.
Strengthening capital markets have made IPOs an increasingly
attractive exit path, although local capital markets beyond War-
saw and Moscow remain underdeveloped. The Warsaw Stock Ex-
change (WSE) hosted 10 IPOs valued at €1.96 billion in the first
five months of 2008, second only to the London Stock Exchange
with €2.18 billion during the same period. Poland-based Enter-
prise Investors recently marked its 25th private equity-backed
IPO on the WSE with the September 2007 listing of Magellan,
a leader in the Polish market of financial services for medical
institutions, bringing in US$105 million in proceeds.
The Russian Trading System has grown dramatically since its
beginnings in the 1990s, but subsequently fell by 95% in the
1998 crisis. Since then, many Russian fund managers have
looked primarily to trade sales as a path to exit, but increasingly
PE-backed companies are listing in London. In 2006, the most
recent year for which data is available, 8 Russia-domiciled com-
panies listed in London. continued on page 7

Sampling of Recent CEE/CIS Exits

Firm Name Company Sector Exit Type Market Exit Date

AIG Capital Partners JetFinance International Consumer Finance Trade Sale Bulgaria Nov. 07
Enterprise Investors Medycyna Rodzinna Healthcare Secondary Sale Poland Nov. 07
Global Finance La Fourmi Retail: Supermarket Trade Sale Romania Mar. 08
chain
Enterprise Investors Artima Retail: Supermarket Trade Sale Romania Oct. 07
chain
Warburg Pincus Euromedic Healthcare Secondary Sale Hungary Mar. 08
AIG Capital Partners AFM Cinemas Retail: Cinema chain Secondary Sale Turkey Feb. 08
UFG Private Equity National Media Group Media Trade Sale Russia Jul. 08
Penta Investments KSC Holding to Flughafen Logistics: Airport Trade Sale Slovakia Jun. 08
Wien AG operator
Citigroup Venture Capital National Logistic Company Logistics Trade Sale Russia May 08
International (CVCI),
RosEvroGroup
Advent International Bolix Paints Manufacturing Trade Sale Poland May 08

6 © 2008 Emerging Markets Private Equity Association

July 2008
According to Cambridge Associates LLC, the CEE and CIS pri-
vate equity index indicates improving returns for the region. The
three-year IRR as of December 31, 2007 reached 59.1%, up
from 45.8% for the same period in 2006.
A recent study by KPMG of PE-backed exits revealed that the
majority of Russian exits in 2007 and 2008 had achieved IRRs
of more than 30%. A sampling of exits in the last few quarters
tracked by EMPEA reveals returns on CEE and CIS investments
ranging from 1.4x to 11x, and IRRs ranging from 19% to 48%.
Market Close-up: Turkey
Private equity has returned to Turkey after a long dormant peri-
od of nearly a decade. Per advisory firm Deloitte, deals in Turkey
totaled US$2.7 billion in 2007, a dramatic number compared to
the US$100 million invested between 1995 and 1999.
Veteran local players such as Turkven Private Equity (Advent
International’s local partner) and Bedminster Capital, around
since PE’s beginning in Turkey, have gone on to raise ever-
larger successor funds. Turkven most recently raised a fund of
US$428 million.
In other cases, fund managers driven away by deteriorating eco-
nomic conditions earlier in the decade are returning. AIG Capital
Partners, which closed its local affiliate in 2004 after failing to
raise the full US$100 million for their Blue Voyage Fund (BVF),
have since restarted operations and rehired the original BVF di-
rector, Serkan Elden, to resume management of the fund.
In 2007, local veterans were joined by Actera Partners, which
raised the largest Turkey-dedicated fund to date with US$475
million with anchor investments from Canada Pension Plan and
The Ontario Teachers Pension Plan. More recently, AccessTur-
key Capital Group, investing in Turkey since 1999 through ven-
ture arm iLab Ventures, announced the launch of a €250 mil-
lion private equity fund focused on mid-market buyouts.
© 2008 Emerging Markets Private Equity Association
EMPEA Insight: CEE/CIS
TPG, KKR, Cinven Group, and Citigroup Venture Capital are
only a sampling of the global private equity firms that are com-
ing to Turkey. The Carlyle completed its first deal in Turkey in
July 2008 with the acquisition of a 50% stake in TVK-shipyard,
a specialized ship-building company. Middle Eastern GPs are
also making forays. In January 2008, Dubai-based Abraaj Capi-
tal invested in leading hospital operator and insurance provider
Acibadem Healthcare Services through its healthcare and infra-
structure fund. NBD Sana Capital, a Middle Eastern player, is
currently raising a US$500 million fund that includes Turkey in
its investment mandate.
Turkey’s private equity industry rose to the fore in 2007 and
again in 2008 with two notable leveraged buyouts. The first was
KKR’s September 2007 acquisition of ferry operator UN Ro-Ro
for US$1.2 billion; debt financed approximately half of the deal.
The second was the BC Partners-led consortium’s buyout of su-
permarket chain Migros Turk, which set records on a regional
and global scale as Turkey’s largest deal ever, and third largest
buyout globally in the first quarter of 2008. Local banks Garanti
Bank, Is Bank, and Vakifbank Bank financed half of the transac-
tion. Leverage was introduced to the Turkish market with TPG’s
June 2006 investment in Mey Icki, the country’s largest produc-
er of the national liquor in a deal valued at US$810 million.
State-owned enterprises remain a potential source of deal flow
for private equity investors, although successful privatization pro-
grams over the past two decades have depleted the remaining
opportunities. PE consortia, including Citigroup Venture Capital
International and Cinven Group were recently outbid in Turkey’s
auction for state tobacco monopoly Tekel. British American To-
bacco (BAT) won the auction. Reflecting the still novel presence
of private equity in Turkey, the former head of Turkey’s privatiza-
tion administration commented, “It was good for competition in
the domestic market the tender had gone to a tobacco producer
rather than a private equity fund, as BAT will view the tobacco
division as a strategic investment.”
Skyline of Maslak
financial district in
Istanbul, Turkey.
Photo by Kerem Barut.
7
Sampling of Firms Investing in CEE/CIS
Fund Manager
CEE-Focused Funds
3i Capital Partners
3TS Capital Partners
7L Capital Partners
AccessTurkey Capital Group
Actera Partners
Advent International
Bedminster Capital Management
East Capital
Enterprise Investors
European Investment Fund (EIF)
GED Private Equity
Global Finance SA
Innova Capital
KD Private Equity
Krokus Private Equity
Marfin Investment Group
Mezzanine Management Central
Europe
Mid Europa Partners
Penton Partners
CIS-Focused Funds
Alfa Capital Partners
Almaz Capital Partners
Aureos Capital
Baring Vostok Capital Partners
CapMan Plc
Centras Capital Partners
Da Vinci Capital Management
Delta Private Equity Partners
Draper Fisher Jurveston (DFJ)
Eagle Capital Partners
Eurasian Private Equity Group
GIMV
Horizon Capital
Kala Capital
Kazyna
Mint Capital Advisors Limited
Renaissance Partners
SigmaBleyzer
Siguler Guff & Company, LLC
Troika Capital Partners
Fund Name Geographical Focus
Eurofund V (2006, US$5.2b) Pan-European, including CEE
3TS-Cisco Growth Fund III (2008, US$40m) CEE
7L Capital Partners Emerging Europe (2006, US$130m) Southeastern Europe
Access Turkey Fund (Name TBD) (raising, US$250m) Turkey
Actera Partners Fund I (2007, US$475m) Turkey
Advent Central & Eastern Europe IV (2008, US$1.6b) CEE
Southeast Europe Equity Fund II (2007, US$320m) Southeastern Europe
East Capital Bering New Europe Fund (raising, US$150m) CEE, Balkans
Polish Enterprise Fund VI (2006, US$776m) Poland
Istanbul Venture Capital Initiative (iVCi) (2007, Turkey
US$300m)
GED Eastern Fund II (2006, US$200m) Southeastern Europe
South Eastern Europe Fund (2006, US$389m) Southeastern Europe
Innova Fund IV (2006, US$350m) Central Europe
KD South East Europe Fund (raising, US$109m) Southeastern Europe
Nova Polonia Natexis II (2006, US$132m) Poland
Marfin Private Equity Fund (2007, US$7b) Southeastern Europe
Accession Mezzanine Capital II (2007, US$386m) Central Europe, Balkans, Russia,
Ukraine
Mid Europa Fund III (2007, US$1.4b) CEE
Central European Selected Opportunities Fund Poland
(raising, US$100m)
Alfa Private Equity Partners LP (2006, US$250m) Russia, Ukraine
Almaz Capital Russia Fund (raising, US$60m) Russia
Aureos Central Asia Fund (2007, US$50m) CIS
Baring Vostok Private Equity Fund IV (2007, US$1.45b) Russia, CIS
CapMan Russia Fund (formerly Norum Russia III) Russia
(raising, US$138.8m)
Centras Private Equity Fund (2007, US$50) CIS
Da Vinci CIS Private Sector Growth Fund Russia, CIS
(raising, US$110m)
Delta Private Equity Partners Fund (TBD) Russia
(raising, US$550)
DFJ-VTB Aurora Fund (raising, US$150) Russia
Eagle Capital Partners Fund (2008, US$24) Russia
EPEG Small Company Buyout Fund (raising, US$50m) Russia
Eagle Russia Fund (2006, US$100m) Russia
Emerging Europe Growth Fund (raising, US$300m) Ukraine, Moldova, Belarus
Georgian Investment Fund (raising, US$1.5b) Georgia
Kazakhstan Growth Fund (raising, US$125m) Kazakhstan
Mint Capital III (raising, US$250m) CIS
Renaissance Private Equity Fund I (2008, US$660m) Russia, CIS
SBV V (2007, US$260m) Kazakhstan, CIS
Russia Partners III (2007, US$1b) Russia
Troika Capital Partners Growth Fund III (raising, US$1b) Russia