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SME Venture Capital Fund (SMEVC) is a government initiative to explore effective means of providing equity financing to commercially-viable and strategically-important small and medium enterprises (SMEs). SMEVC is part of the government’s “August 10, 1999, Financial Package”. |
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The Fund shall invest in shares of suitable SMEs with long-term objectives, to help the invested SMEs improve their business capabilities and efficiency, in preparation for entering a wider capital market. |
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| Fund Features |
| Fund manager | One Asset Management Ltd. |
| Type of fund | A closed-end mutual fund with 10-year maturity |
| Registered Fund | 1.2 billion baht with initial investment of 1.0 billion baht from Thai Government |
| Mutual fund supervisor (Custodian) | Citibank N.A. Bangkok Branch |
| Auditor | KPMG Audit (Thailand) |
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To strengthen financial position of targetted SMEs |
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To promote good corporate governance in targetted SMEs. |
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To help create more robust and resiliant structure of the Thai economy by promoting strategic SMEs. |
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To help develop Thai capital market and strengthen the country’s financial system. |
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| Investment limit | : | 10-50% of registered capital |
| Maximum investment | : | Baht 25 million amount per company |
| Investment period | : | 3-5 years |
| Directorship | : | the fund may require a board seat in the company |
| Investment approach | : | passive i.e. do not get involve with day-to-day operation |
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| In addition to financial support through equity investment, the Fund will also provide technical assistance to investees by : |
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Providing experts to give on-site and off-site advice to the invested SMEs in production, finance, management, etc. |
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Co-ordinating additional support from agencies of the Ministry of Industry and other suitable organizations for the maximum benefit of investees. |
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Include SMEs in the manufacturing, trading, and service sectors. |
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Possess one or more characteristics of “strategic” SMEs which can contribute to strengthening the country’s economic structure. |
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Do not possess any of the “undesirable” characteristics of “non-target” SMEs. |
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Have good business potential, with good possibilities of divesting in IPO, or other means with high return, in 3-5 years. |
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Have a Debt-Equity ratio (D/E) of not more than 2:1 following participation of the Fund. |
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Target investment 10-50% of register capital |
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| Characteristics of “Strategic” SMEs |
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Provide critical link in the value-added/supply chain, especially where there is significant gap in the country’s economic structure. |
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Have high value-added (or higher in comparison to other businesses in the same industry). |
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Provide products or services that reduce dependency on imports. |
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Create foreign exchange earnings. |
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Utilize & assimilate technology which is not yet widely available in the country, especially technology that is of value to other product or service lines. |
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Commercialize innovation in products, services, production or work processes, especially innovation based on indigenous know-how. |
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Create jobs in the rural area without associated environmental problems. |
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Rectify environmental problems or promote improvement of environmental quality. |
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| Non-target Businesses |
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Companies already listed in the stock market, and thus have ready access to public funds. |
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Companies that create environmental problems. |
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Companies that violate intellectual property rights. |
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Companies that provide products or services which are contrary to good moral principles and tradition. |
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Companies that pose dangers to society. |
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Companies whose business is not transparent. |
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Companies whose products or services are in severe over-supply in the marketplace. |
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| The Fund shall exit from the invested SMEs at an appropriate time in the future by ways of |
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Listing in the Stock Exchange |
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Sell back to the entrepreneur |
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Sell to other strategic partner(s) |
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