Swedfund, the Swedish government’s SME-focused fund, has invested $15 million in Excelsior Capital Vietnam Fund II to boost Vietnamese private sector development and growth, according to an announcement.
This development comes shortly after the Swiss Investment Fund for Emerging Markets (SIFEM) said it has committed $20 million to Excelsior Capital Vietnam Partners’ (ECVP) $200-million second fund in August this year.
Earlier, DealStreetAsia reported that SIFEM had made a $12-million commitment to the Vietnam-based growth equity firm’s first fund in 2019.
ECVP II plans to invest in 10-12 mid-sized companies in Vietnam across the healthcare, consumer, education, and technology sectors, according to SIFEM. Investments will be made through active minority ownership stakes in the form of equity or quasi-equity deals.
Vietnam has made strong progress in reducing poverty and growing its economy. However, it still faces challenges, including the need for more funding to build infrastructure, support small businesses, and ensure increased access to financial and other services.
The Vietnamese banking system is still in an early stage of development with limited long-term financing capabilities, especially for SMEs. SMEs constitute 98% of registered companies in the country, according to Swedfund.
“With our investment in Excelsior II, we increase access to capital for mid-size and growing businesses. This strengthens the Vietnamese private sector and contributes to creation of quality jobs, improved industry standards, and to increased women participation in the workforce, and in leading positions. Moreover, it contributes to increased participation in the formal economy, in a country where 65% of the workforce operate in the informal economy. In this way, Swedfund’s investment supports a more sustainable and resilient economy,” said Sofia Gedeon, Investment Director Sustainable Enterprises, Swedfund.
Excelsior II provides growth capital to mid-sized companies and will contribute to job creation in sectors like retail, manufacturing, healthcare, education, and tech.
As a fund aligned with the 2X Challenge framework, Excelsior II is committed to enhancing opportunities for women and promoting their participation in Vietnam’s formal economy.
DealStreetAsia reported in December 2024 that ECVP secured a first close of about $100 million for its second vehicle from both existing and new limited partners.
