Selection of IPO Fund Manager Announced

On 7 June Latvia’s and Lithuania’s national financial development institutions ALTUM and “Investicijų ir verslo garantijos” (INVEGA), announced the selection process for the IPO Fund (Baltic Capital Market Acceleration Fund) manager, who will be responsible for implementing the fund’s strategy. The target audience for the IPO fund includes SMEs and small, innovative mid-cap companies operating in the Latvian and Lithuanian markets, with plans to list on the Baltic Stock Exchange in the future.

Applicants interested in managing the IPO Fund can submit their applications until 30 August, 2024, at 23:59, by sending them electronically to ipo@altum.lv or equity@invega.lt. Following the application deadline, the selection committee will begin evaluating candidates, and the selected fund manager is expected to be announced by the end of the year.

Ieva Jansone-Buka, Member of the Board (ALTUM):

“The initiation of the manager selection process is the next step towards launching the IPO fund. During the preparation stage, in collaboration with our Lithuanian colleagues, we held public consultations with market participants regarding the selection process regulations and received over 60 recommendations that helped refine the selection criteria. The fund manager’s responsibility will be to select companies that are suitable for capital market development and for whom this step represents the next phase in their growth and expansion. Currently, small and medium-sized enterprises primarily finance their development through their own funds, bank loans, and venture capital. International experience demonstrates that the capital market is one of the three main pillars of corporate capital accessibility.”

For more information about the selection process, please visit: Venture Capital – Altum

The total fund volume is planned to be EUR 48.78 million, with EUR 20 million invested by ALTUM, EUR 18.78 million by INVEGA, and EUR 10 million to be raised by the fund manager. The fund’s investment strategy includes investments in Latvia and Lithuania, at least in the amount of each country’s invested capital. The fund will provide financing for SMEs and small or innovative mid-cup companies for initial listings and inclusion in the Baltic States securities market, primarily the stock market, by investing in initial public or private equity (IPO) and bond (IBO) offerings on the Nasdaq Baltic Stock Exchange. Additionally, the fund may invest in the pre-offering stage with the clear intention of listing the company on the exchange within a suitable timeframe (approximately 12–36 months), as well as in the IPO/IBO secondary market, provided that the fund participated in the initial IPO/IBO.

The fund will prioritize profitable SMEs and small or innovative mid-cup companies with an enterprise value ranging approximately from EUR 5 to 100 million. It aims to support 13-18 companies, With planned investment amounts per company ranging from EUR 0.5 to 5 million, the fund will have the capacity to invest up to 50% of the total investment amount.

The Cabinet of Ministers granted approval for the establishment of the Baltic Capital Market Acceleration Fund on 13 June, 2023.