Milos Lukic, Manager at ENEF Fund for Serbia - We pour EUR 77 m in local companies

Source: eKapija Thursday, 23.10.2014. 16:12
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Milos LukicMilos Lukic

Since May, SMEs in Serbia are provided EUR 77 m ininvestment funds which EBRD assignes within ENEF Fund. Set up with an objectiveto speed up development of this department (founders are EBRD, EIF and GermanInvestment Fund DEG), the Fund invests in companies with high potential ofgrowth in all fields. The Fund’s take is always minor one (20-35%), the Fund will participate in managementmethod and the stake and profit and loss will be in line with ownership stakes.


- The interest in project funding has been on the increase and we are reallygetting a lot of requests for additional information and for the company which appliesfor the assets of the Fund, estimation of current business will be the keyfactor - Milos Lukic, Manager at ENEF Fund for Serbia says in his interviewfor eKapija.

With the representative of the EBRD in Serbia, we spokeabout conditions companies have to fulfill, how their work will be controlledand which sectors will have an advantage.


eKapija: Have the first assets of the Fundbeen approved and to what extent?


- Since it is ab out investments in capital more risky than other, and takinginto an account the fact that the Fund for support of SMEs development startedoperating in Serbia 4 months ago, funds have not been approved yet but thereare potential candidates which have been undergoing approval process.

eKapija: Which conditions does a company haveto fulfill to apply for the funds?


- The investment must range between EUR 1 to 10 m. We fund a large number ofindustries with an exception of military industry, arms, and games of luck,gambling, tobacco and alcoholic drinks. Our stake always has to be a minoritystake. Other terms depend on a company, investment type and financial positionso it is defined depending on a case.



eKapija: Are there terms when it comes tocompany ownership?


- Company applying does not have to be domestic, when it comes to funding it isnot the condition. The condition of domestic ownership refers only to consultingpart, i.e. for consultant engagement.


eKapija: How does EBRD estimate companies which apply?


- They use the basic methods of company evaluation such as discounted cashflows, comparable companies and transactions. As I have mentioned, sole companybusiness estimation is a key thing and it is the base for value estimation.


eKapija: Which types of investments will the Fund invest in, are theresectors which will have advantage in project selection?


- The Fund will invest in different types of investments such as capacityexpansion, modernization, penetration to other markets, acquisitions, etc. Everysector will be considered as long as it complies with parameters which I havealready mentioned.


eKapija: How does project approval process look like and how long does it last?


- The approval process lasts 3-9 months, depending on project complexity andinstrument used.



eKapija: Are companies which get funds fully independentin further work? How will EBRD control their work?


- Companies are fully independent in their work and everyday business decision makingprocess except from strategic decision when agreement with EBRD as a co-owner is necessary. EBRD will controlthe companies on monthly or quarterly basis through reporting and meetings ofsupervisory board and shareholder assembly.

eKapija: How does ENEF step out of theproject?


- The investment period lasts from 3 to 10 years, most often 5-7, after whichEBRD stake is offered either to strategic buyers or existing majority ownersand the strategy of stepping out of the ownership is known ahead.



Ivana Bezarevic
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