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EAEF contributes to LCP Fund II first close

Anna Lyudvig
Oct. 6, 2020, 10:31 p.m.
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The Egyptian American Enterprise Fund (EAEF), a US government-funded private entity, has invested $50m in Lorax Capital Partners (LCP) Fund II, which has raised $142m for its first close.

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The Egyptian American Enterprise Fund (EAEF), a US government-funded private entity, has invested $50m in Lorax Capital Partners (LCP) Fund II, which has raised $142m for its first close.

LCP Fund II aims to raise up to $250m to invest primarily in growing companies in Egypt.

EAEF is joined by the European Bank for Reconstruction and Development (EBRD), the International Finance Corporation (IFC), the European Investment Bank (EIB) and Proparco as investors in LCP Fund II.

Incorporated in 2015, Lorax Capital Partners (LCP) is an Egypt-focused private equity firm managing the EAEF’s funds.

LCP is EAEF’s long-term partner on the ground.

In 2015, EAEF appointed LCP as its asset manager and investment advisor in Egypt.

In five years, LCP has become one of Egypt’s leading private equity funds with support from a talented staff of Egyptian investment professionals.

LCP has invested in five companies on behalf of EAEF, which include Fawry, Egypt’s largest electronic payments platform and Sarwa Capital, the country’s leading consumer finance company.

Both these companies held successful IPOs within four years of our investment.

In August, Fawry became Egypt’s first unicorn company after achieving a market capitalization of $1bn.

The decision to seed and appoint LCP as its asset manager and investment advisor was the first and most important step made by EAEF in its early years.

EAEF’s model of empowering local fund managers has been key to its success to date and catalyzing the growth of Egypt’s private equity and venture capital markets.

James Harmon, EAEF’s Chairman, said: “Lorax has been instrumental to EAEF’s success and advancing our goal of developing Egypt’s private sector. I believe Lorax is Egypt’s most successful private equity firm today. Lorax’s success is a testament to the outstanding team that was built over the last five years. In the coming years, I believe Lorax will be the leading private equity firm in the Middle East and North Africa region.”

“Very few if any funds have closed in the region in recent years. It is a tribute to the Lorax team that they could close in today’s difficult environment. EAEF is proud to have seeded Lorax and looks forward to its future growth.”

Ashraf Zaki, LCP’s Managing Partner, added:  “LCP would not be here today without the support of EAEF, which provided the capital that helped establish LCP and led to its first, independent private equity fund. The trust and support placed in LCP by Jim and EAEF’s board allowed LCP to make investments that have not only generated considerable returns but contributed to Egypt’s socioeconomic growth. We are appreciative of EAEF’s support over the years and look forward to working together into the future.”

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