In just five years, Luc Gerard’s Colombian private equity firm, Tribeca Asset Management, has built a $420 million portfolio of investments in companies that include swimwear maker OndadeMar, miner Brexia Resources and medical services provider Groupo Emi. Gerard was in New York last week to raise money for Tribeca’s new $750 million fund and to interview placement agents.
Like Tribeca’s first five funds, Tribeca General Fund VI would be earmarked to invest mainly in Colombian companies, focusing on healthcare, natural resources, power generation and consumer goods. Unlike the firm’s first five funds, however, the new fund is Tribeca’s first to seek investors outside of Colombia.
Gerard, a native of Congo who has lived in Colombia eight years, says he’s comfortable with the $750 million target, saying that several placement agents have told him the goal was reasonable given the firm’s track record. He’s aiming to have more than $500 million come from outside the country and Tribeca’s main LPs, Colombian pension funds.
A large portion of the funding is already targeted to specific acquisitions. This is good, Gerard says, because it helps LPs get a solid understanding of the sectors that Tribeca invests in. It also helps speed up the process. Tribeca’s funds were fully invested long before their investment periods expired.
Of course, the pitch Gerard will be making to pension funds and endowments will highlight the story of Colombia itself. “For the investment community,” he says, “Colombia is no longer a secret. When I see institutional investors pouring into the country, it’s clear the word is out.”
As a group, the race is on among local private equity firms in Colombia, according to Euromoney. More than 20 upstart firms are in the process of raising funds.
But some investors still have an outdated image of Colombia as a haven for cocaine and corruption. To those people, “I tell them Colombia is the fastest growing and most stable country in Latin America with the possible exception of Chile,” Gerard says.
Colombia’s story, he says, is just as good as its neighbor, Brazil, but because Colombia was not one of the BRICs, a term that helped send oceans of capital to Brazil, Colombia’s valuations “are not nearly as high as they are in Brazil.”
Indeed, Gerard, who left his native Congo to study in Europe before shuttling to 11 countries on assignment for various multinationals, said he was shocked when he got to Colombia. There was a huge difference, he said, between the perception that people had outside the country versus the reality inside it.
“What I discovered,” he said, “was one of the most vibrant places in all Latin America, not only economically, but intellectually. The entrepreneurial spirit in Colombia is fantastic.”