Reconstruction Capital II (RC2), a private equity fund with 75m euros' worth of investments in Romania, has multiplied the capital invested in Albalact by four times, and expects returns and growth in fields its rivals chose to ignore.
"We choose situations and fields that are not competitive - companies that are targeted less by rival players on the domestic private equity market, and we also identify niches with potential growth. Our fund's current portfolio stands proof: Top Factoring, a receivables management firm, Albalact, a dairy producer, and Antares Hotel, while, as a rule, private equity funds usually avoid the hotel sector," says Ion Florescu, manager of New Europe Capital (NEC), which manages the RC2 fund.
The fund's first investment in Romania was also its most profitable, after it acquired a minority stake in Albalact two years ago, which brought a 400% return at the moment of exit.
Listed on the London Stock Exchange, RC2 entered the Romanian market in 2006 through an investment in Albalact, followed by investments in Top Factoring, Romar and Antares Hotel. In the first half of 2007, RC2 acquired 92.3% in Top Factoring and a 33.3% stake in Romar Grup, a private medical services group. RC2 invested 3m euros in the two deals.
In 2008, the fund's list of acquisitions included Antares Hotel, where the fund bought a 63% stake in the wake of investments worth 8m euros. Centrul Medical Unirea also stirred the fund's interest, but the deal was not reached because of the high price involved.
At present, RC2 investments in Romania amount to 75m euros, "half being invested in listed companies and half in unlisted ones".
"At present, the fund's assets stand at 150m euros, of which 75m euros are invested in Romania, 5m euros in Serbia and Bulgaria and the remaining 70m euros are cash (...)," said Florescu.
The fund's st
