EIF and the Greek Government launch new EUR 260 million Equity Fund-of-Funds

New EU-backed Fund-of-Funds initiative boosts equity financing for high-growth Greek SMEs

The European Investment Fund (EIF) and the Hellenic republic, represented by the Greek Ministry of Economy and Development have today signed a Funding Agreement to establish a EUR 260 million risk capital Fund-of-Funds. This new financial instrument, which will finance independently-managed funds, aims to facilitate access to finance for entrepreneurs in the country. By attracting private capitals, the Fund will help them turn their ideas into concrete projects with high value added, for the direct benefit of the Greek real economy.

This new initiative will support technology transfer funds in Greece and kick-start investments into accelerator funds. Equity companies, from early stage start-up companies to mature growth companies, will also benefit from the EUR 260 million Fund-of-Funds. The Fund-of-Funds will be instrumental in unlocking the equity potential in the Greek market.

The Fund-of-Funds is supported by the European Structural and Investment Funds (ESI Funds) and will be backed by the European Fund for Strategic Investments (EFSI), the heart of the European Commission’s Investment Plan for Europe. It will also be the first time that ESI Funds and the EFSI are combined in Greece. EUR 200 million comes from the Operational Programme Competitiveness, Entrepreneurship and Innovation 2014-2020, supported by the European Regional Development Fund. This amount will be complemented by EUR 60 million co-invested by EIF, which will include up to EUR 10 million from EFSI supported resources.

The Hellenic republic, represented by the Greek Ministry of Economy and Development and EIF through their EUR 260 million commitment will constitute the first cornerstone investors in a broader equity investment platform which, is designed to attract more like-minded institutional investors.

Speaking at the launch event in Athens, European Investment Bank President Werner Hoyer, said: “This new equity initiative launched with the Greek government today will provide a substantial boost to the equity ecosystem. The Greek Fund-of-Funds is the first initiative of this scale ever launched in Greece for equity investments into venture capital funds and will be a crucial source of finance for SMEs. The EIB Group is fully committed to supporting jobs and growth in Greece and this new Fund-of-Funds is a clear example of our continued investment engagement in the country”.

Dimitris Papadimitriou, Minister of Economy and Development said “This Fund of Funds is transformational for Greece, both in terms of size and approach. It will support capital formation across the equity value chain. By partnering with EIF we are confident that the ramp up and implementation of this Fund of Funds shall be delivered in the best possible way.

EU Commissioner Corina Crețu, responsible for Regional Development, said: “This Fund is an example of a successful combination of Cohesion Policy funds with the EFSI. It will give a boost to innovative businesses in the country and help them access new markets. This shows Greece’s commitment to having an ambitious growth and investment strategy and I am proud that Cohesion Policy funds can be a part of it.”

European Investment Fund Chief Executive, Pier Luigi Gilibert, stated: “This ambitious Fund-of-Funds project will help to fill the Greek SME equity financing market gap. EUR 260 million will contribute significantly to all investment stages of the Greek equity market and create a lasting impact for Greek businesses. It is expected that this initiative will put the emerging Greek entrepreneurship potential into the limelight and accelerate the development of the equity industry in the country in a holistic way”.

Background information

The European Investment Fund (EIF) is part of the European Investment Bank group. Its central mission is to support Europe’s micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.

The Investment Plan for Europe focuses on strengthening European investments to create jobs and growth. It does so by making smarter use of new and existing financial resources, removing obstacles to investment, providing visibility and technical assistance to investment projects. The Investment Plan is already showing results. The projects and agreements approved for financing under the EFSI so far are expected to mobilise more than EUR 164 billion in total investments across 27 Member States and to support almost 388,000 SMEs. On 14 September 2016, the Commission proposed extending the EFSI by increasing its firepower and duration as well as reinforcing its strengths. Find the latest EFSI figures by sector and by country here. For more info, see the FAQs.

The European Structural and Investment Funds will invest EUR 20 billion in Greece over 2014-2020. More information is available here and on the Cohesion Open Data platform.

Source: https://www.eif.org