Published: February 28, 2011
Debut Palestine fund launched.
The Palestinian economy is set for a boost after investment and consultancy firm Massar International raised some US$60mn for what it claims is the first private equity fund dedicated to investing in companies operating in the territory.
The Siraj Palestine Fund I, which is expected to be worth US$80mn at its second and final closing in the next few months, will invest in family-owned small and medium sized businesses (SMEs) to promote technological advancements, job creation and sustainability.
Investors include the Overseas Private Investment Corporation (OPIC), the Soros Economic Development Fund, the Pension Boards of the United Church of Christ and Crescent Investments as well as Massar and several Palestinian companies.
Elizabeth Littlefield, OPIC’s president and chief executive, said Palestinian-owned SMEs are an important engine of growth and employment in the region and the fund’s strong first closing indicates that there is a belief among investors that capital placed in the region will yield positive returns.
Massar’s founder and chairman, Bashar Masri, adds that he hopes additional Palestine-focused funds will be launched in the near future. “The strong response received from local and international investors underscores a clear determination to revive the Palestinian economy as well as to encourage direct foreign investment.
“Palestine’s private sector is thirsty for an infusion of cash and managed expansion,” he added. “We'll get in, make companies more operationally effective and more profitable, and then exit.”
The fund is currently negotiating deals with several companies in a range of sectors, such as manufacturing, agriculture, ICT, healthcare, transport and logistics. It also intends to target the construction industry where, due to a national housing shortage, it hopes to meet demand for the numerous real estate projects across the West Bank, including the first Palestinian city, Rawabi.
In addition to capital the fund will also offer technical assistance and training needed to improve governance structures.