European Accession Fund (EAF), an American private equity fund which invests in central Europe, is currently working on twelve projects. By the end of next year, EAF is planning on raising USD250m. At least half of this sum will be used in Poland.
Przemyslaw Krych, EAFÃs partner in Poland says that the fund is designed to have a ten year life. It will invest for four years and then use the remaining six to pull out of the business.
EAF will not get involved in start-ups. It is seeking a stake in those companies which are prospering with a developed brand.
EAF is the first fund in Poland which aims to use leveraged buy outs (LBO). This is a particularly useful tool for a fund if the investment proves to be worthwhile although it is more risky. Przemyslaw Krych says that as this method is being used for the first time in Poland, the risk is being shared by his company and Bank Handlowy.
Of twelve projects, the company is considering one in Bulgaria and Serbia, two in the Czech Republic and eight in Poland. In June EAF took a sixty percent stake in Warsaw based medical provider Luxmed. EAF is planning to raise the capital of the company further.