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Asian fund sinks $11 million in BPL project

SARF Chairman Ken Balendra has said the investment would be made in a project launched by BPL Cellular. "The SARF board has already approved that project and our investment will be $11 million," said Balendra who is also the chairperson of the Sri Lankan mega-corporation, John Keells.

T O D A Y

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He also said that the SARF would invest in another Indian telecom project shortly.

"The third investment of the fund is in a tourism project in the Maldives," Balendra said. The project, in which SARF will deploy $3 million, will be handled by Sri Lanka's Aitken Spence Company, which has already built two tourist resorts in the Maldives.

SARF is an equity investment fund for development activities in South Asia.

It was established by the Commonwealth Development Corporation following a directive at the last Commonwealth Heads of Government Meeting in Edinburgh.

The fund will meet the growing equity needs of the region.

Balendra said the SARF board is examining several proposals forwarded by CDC representatives in the region.

The $108 million fund can invest throughout the South Asian Association for Regional Co-operation region, CDC CEO Donald Peck said.

"Its objective is to achieve long-term capital appreciation through equity investments in private sector companies," he added. Peck said, the SARF could invest up to $11 million in any project, taking significant minority equity positions.

It can invest in a range of sectors and listed or unlisted shares. It can also invest in management buy-outs, expansions, start-ups and management buy-ins with significant growth potential.

"SARF is not a short-term portfolio investor," Peck said. "It is a long-term investor... works closely with management teams." While regional equity markets have performed poorly over the past six months, SARF takes a longer perspective, focussing on the fundamentals of an investment, he explained.

Peck said the CDC has a portfolio of $78 million in Sri Lanka, including the investment in the National Development Bank, the largest financial institution in the country.

- Compiled from the Indian media

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