Private capital poised for takeoff

AMP Asset Management is close to raising the minimum necessary to launch its private capital fund.

Monday, February 21st 2000, 12:00AM

AMP Asset Management says it is close to raising the minimum $10 million necessary to kick off its private capital offering.

The offer, which was due to close on Friday, has been extended for another 15 working days to allow the late interest to participate. AMPAM is aiming to raise $25 million and the prospectus allows it to accept up to $75 million.

A spokesman for the company says about $9.5 million has been raised so far, however the final figure is likely to be higher as interest has been strong in the past couple of weeks.

"We have had exponential increases in the past two weeks," he says.

The money is fairly evenly split between wholesale and retail, and while there has been some support from the independent financial advisory network, AMPAM has had good support from AMP advisers.

“Our AMP Adviser and broker network have indicated that they have been experiencing a significant amount of ‘last minute’ interest in the private capital offer,” AMPAM head of private capital Martin Turner says.

Turner says the extension is a one-off: "We currently have a number of private capital opportunities ready and waiting, and are keen to commence investing."

Private capital is a new form of investment in New Zealand and this particular offer is aimed at wealthy investors. That is those people who have $250,000 portfolios and are prepared to lock it into an investment for 10 years.

AMPAM says its private capital fund will invest in unlisted companies which have significant growth potential. These can be companies such as Eastern Equities and Donaghys which are now delisted following successful management buyouts, new companies and those seeking capital to expand.

The key features, from an investor's perspective, is that the fund is illiquid, it has a high minimum entry ($30,000) and the money needs to be locked into the fund for its whole 10 year life cycle.

AMPAM says the money raised will go into new investments, not those it has already made in private capital. It expects to make at least eight separate investments of between $5 million and $25 million.

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