GK Capital eyes big stake in venture capital fundsWednesday, September 17, 2014
GK Capital Management plans to invest big in the venture capital market in Jamaica.
The investment company might even take a few of the companies that it invests in to market “whether through the stock exchange or through the junior stock exchange”, according to GraceKennedy Group CEO, Don Wehby.
Previously, GK Capital signalled that it would be willing to invest up to US$2 million in venture funds which have a total value of US$20 million or upwards.
That is, if 70 per cent or more of the funds are invested in Jamaican companies, according to the Development Bank of Jamaica (DBJ) in its 'Call for Proposals from Local and International Venture Captial and Private Equity Funds' dated July 31.
“I have been waiting on the day for us to put in place the proper infrastructure for venture capital and I am hoping that it will not take too long before we can start rolling out,” said Webhy. Though the conglomerate has placed priority on investing in food manufacturing and agro-food processing companies, GraceKennedy’s investment company is placing no restrictions on the type of businesses that it invests in.
The CEO said that GK Capital will be keeping an eye open for investment opportunities that do not fall squarely within its core business. The information technology (IT) and animation sectors are two such areas that GraceKennedy has expressed strong interest in.
The rate at which these areas have been growing makes them ripe for investment, Wehby reckons. At this stage, “we are looking at small and medium local companies that we can help to grow, especially in the overseas market… as this falls within GraceKennedy's export led growth strategy,” said the Group CEO. GK Capital is also not ruling out the possibility of investing in some start-up companies as well.
Webhy said that, as long as the due diligence and market research points to the company growing significantly as a result of Gracekennedy's investment of capital, human resources and management discipline, they are willing to invest.
GK Capital Management is one of the eleven companies that are seeking to take equity positions in the formation of venture capital funds that is being facilitated by the DBJ, through which they will evaluate projects and deals in which they will consider investing. The DBJ aims to have the first venture capital fund up and running by next year.
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