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Carlyle Group looking to invest in Peru
July 27, 2012
The U.S.-based private-equity firm Carlyle Group is looking to invest in Peru as this country offers positive macroeconomic trends over next five years.
JuanCarlos Felix, a managing director at Carlyle, told MarketWatch in an interview in Lima earlier this month that they are looking actively at deals in Peru with an eye to completing a first deal over the next two to six months, Dow Jones Newswires reported.
“In South America, we like the risk-reward opportunities in Peru, Brazil, Colombia and Chile,” Felix said. “We see positive macroeconomic trends in Peru continuing over the next five years. Growth here is compelling.”
Peru’s economy, which has enjoyed a decade-long boom, is projected to grow around 6% this year. The country also boasts macroeconomic stability and low debt levels.
“Inflation is under control and the exchange rate is very stable. The second thing is the political stability. You have the rule of law. We are confident that the direction of the country is reasonably well set,” Felix noted.
Carlyle is targeting equity amounts of between $200 million and $250 million for investments in Peru. In the next three months, the firm should have in place a four-person team in Lima, the Andean nation’s sprawling capital city.
Carlyle is looking to recruit professionals who were born and raised in Peru, but have been working abroad and are looking to return to their home country. “There are challenges elsewhere in the world that make returning to Peru attractive,” Felix said.
Last year, Carlyle set up a joint venture with Credicorp Ltd. BAP +1.21% , Peru’s biggest financial group, looking to gain some local knowledge of the business community and markets.
“Our model is to buy companies that are family-owned and here 80% of companies are family-owned. It’s really what drives the country,” Felix said.
The sectors showing the most potential in Peru are education, healthcare and services to the mining sector, according to Carlyle. The education (private universities and technical schools) and healthcare (hospitals, insurance brokerages, etc) sectors will benefit from the growth of the Peruvian middle class, Felix said.
“We will not invest in big capex projects. We don’t like to have direct exposure to commodities prices,” he said.
Peru – which is very rich in precious and base metals, such as gold, copper, silver, and lead – has attracted significant investment from foreign mining companies, but in some parts of the country there has been opposition to foreign-owned mining projects.
“Political tensions could affect the country as a whole, but we are optimistic,” Felix said. “That’s one reason why we want to invest in services, so if something happens in one region you can redirect your focus. I can see a scenario where a couple of mining projects will be delayed or will not happen, but not the whole mining industry.”
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Total coments: 2
Commented By: NYpoodle
On: July 27, 2012. 9:04 pm
This would be a problem for Peru and South America, “Our model is to buy companies that are family-owned and here 80% of companies are family-owned," because they'll run everything, Pay and Charge what they want, and people in Peru won't own anything, it will be all owned by the Carlyle Group. Peru needs what is Peruvian owned. Carlyle should think about other methods of Investment. This is a total set, Peruvians beware of this group that flashes a bunch of money in your face
Commented By: Lobo69
On: July 28, 2012. 12:26 am
I surely hope not! The wicked goons from this corrupt military-political-industrial complex, known as the Carlyle Group will ruin Peru!
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