Equity funds

Equity funds

Equity Funds

  • Colombia is ranked as the fourth country in Latin America in terms of business climate and friendly regulatory framework for the development of Private Equity Funds. LAVCA, 2012.
  • The Private Equity Fund sector has seen a 27% growth in recent years. The Colombian Association of Severance Pay and Pension Fund Administrators (Asociación Colombiana de Administradoras de Fondos de Pensiones y de Cesantías, ASOFONDOS), 2011.
  • The Colombian Government created investor support programmes such as Bancoldex Capital and INNpulsa for Equity Funds and Venture Capital. ASOFONDOS, 2011.
  • Colombia has great potential. At the close of 2012 Colombia will represent close to 5% share of the Private Equity Fund industry in Latin America and 2% worldwide. PWC, 2011.
  • Colombia forms part of the integration of stock markets together with Chile and Peru. The Integrated Latin American Market (Mercado Integrado Latinoamericano, MILA).
  • As of 2012 Colombia offers 22 Private Equity Funds and 1 Venture Capital Fund. There are approximately 15 new initiatives in the making (including 2 Venture Capital initiatives).
  • In the last 3 years investments have reached about US$ 3 billion.
  • Approximately 15 new initiatives from different administrators are expected to be added to the existing 23 funds in Colombia (foreign and national). In 2013 they will total around US$ 4.5 billion (an additional US$ 1.5 billion).
  • At the close of 2012 the Private Equity Fund industry is expected to have 16 new foreign companies established in Colombia.

Business Opportunities

  • Infrastructure: The National Infrastructure Agency (Agencia Nacional de Infraestructura) is currently organizing the biggest highway concession in Colombia's history (including railway, port, airport and roadway infrastructure). The Public-Private Partnership scheme and the investment of local and foreign equity funds will be highly relevant in this process.
  • Hydrocarbons (Goods and Services): A timely interest for direct investment has been identified through equity funds in specialized areas such as water treatment in the oil sector.
  • Energy: The possibility of multinational energy partnerships in Colombia represents an opportunity for expansion in Latin America under the concept of Private Equity Fund leverage.
  • Microfinance: This sector is becoming increasingly stronger, not only through investment, but also in terms of its social impact. The continued input of funds is expected, mainly from Benelux and Switzerland.
  • Health, restaurant, hotel and manufacturing services: These sectors have strengthened over the last three years triggering both growth and development of different companies in Colombia, as well as the continued rise in the creation of jobs.