Hong Kong, Jan 18, 2006 AEST (ABN Newswire) - Asian Development Bank (ASX: ATB) and Hong Kong fund group ADM Capital announced today the closing of a US$338 million Limited Partnership fund, the ADM Maculus Fund II L.P., that will promote the recovery of financially distressed, but potentially viable, companies in Asia. This is the second Fund in the ADM Maculus series taking the total to US$476 million. A third fund of US$688 million is planned for launch in the second quarter of 2006.
ADB is a cosponsor in the ADM Maculus Fund Series and has committed a total of US$45 million to the series.
The ADM Maculus Funds focus primarily on Southeast Asian markets, which are believed to harbor the equivalent of more than US$800 billion in nonperforming loans.
Typically, the ADM Maculus Funds will buy out existing creditors to initiate financial or corporate restructuring of companies that are at risk of bankruptcy due to excessive and unsustainable debt levels or financial mismanagement.
"By investing in active corporate restructuring we aim to help companies to regain their operational viability, sustain their economic contribution to their markets, and lessen the adverse impacts for stakeholders such as employees," says William Willms, Principal Investment Officer of ADB's Private Sector Operations Department.
"Not addressing the NPL problem of the banking sectors will impair capital significantly. As credit costs increase to cover the cost of NPL losses, financial institutions would resist making fresh loans."
He adds: "The Fund's core objective aligns with ADB's strategy of promoting poverty reduction through job creation, infrastructure preservation, development, banking reform, and corporate governance."
Contact
Floyd Whaley
Email: fwhaley@adb.org
Tel:+632 632 6848;
+63 9717 888 6848
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