News
North Korean Fund Launches Subscription
February 24, 2009
A fund designed specifically for investment in the Democratic People's Republic of Korea [DPRK] starts to raise initial US$50 million.
Hong Kong - North Korea specialists KoryoAsia Limited today announced the launch of subscription to the ChosunFund Limited, a fund designed specifically for investment in the Democratic People's Republic of Korea.
ChosunFund is seeking to raise an initial US$50 million and will be managed by Hong Kong-based AngloAsia Capital Management. AngloAsia will benefit from KoryoAsia's decades of experience in the DPRK.
ChosunFund will initially be focused on three specific areas:
- The regeneration of the DPRK's extractive industries;
- The energy sector, particularly where enhancing existing capacity from coal, hydro electric and alternative means of power generation, such as biogas, wind power, etc. can revive profitable hard currency earning entities; and
- The country's defaulted London Club Debts which presently exclude the DPRK from international financial centres and restoring its international correspondent banking relationships.
"The DPRK has effectively been cut off from the international business community for decades. The country holds huge natural resources but is capital starved and lacks the technology and management skills with which to develop them." said Colin McAskill, Executive Chairman of KoryoAsia.
ChosunFund will conduct its business, and will assist the DPRK develop its economic activities, along internationally accepted practices, building a transaction-based portfolio in areas that have been known to be successful exporting organizations and foreign currency earners.
McAskill continued. "KoryoAsia has a long track record with the DPRK, a relevant network of contacts, a strong pipeline of investment opportunities and a proven ability to execute. Coupled with the team's highly-relevant experience in other emerging Asian markets, this creates a formidable entity to open up North-East Asia's last 'Frontier' Emerging Economy."
ChosunFund will also seek capital growth through investment in businesses in DPRK that are seeking working capital to fund expansion of existing operations in the export markets as well as for domestic consumption that can provide repatriated profit. It will focus primarily on established businesses that have potential for high profit growth from the application of additional capital and international expertise.
"ChosunFund leverages on our team's experience of working in other emerging Asian economies over the past decades which has shown that access to capital is only a part of the solution, with access to technology, management skills and international markets equally important in making the most of the very attractive investment opportunities that exist in the DPRK." said Gerry Elias, Executive Director of KoryoAsia. He continued. "We are able to bring in management, technology, joint venture partners and internationally accepted business ethics and practices working with contacts and investments built up over many years to add value and realize the potential to its fullest extent."
For further information, please visit www.ChosunFund.com, or contact:
About KoryoAsia
Established in 2000, KoryoAsia has a deep understanding of the political system, culture, financial structures and risks/opportunities of the DPRK. Its team of seasoned international professionals effectively combines Western investment discipline and best international practices with DPRK experience. Its principals have established an extensive network of international professional contacts. They will be able to identify and assess opportunities in the DPRK that may be closed to others. The team's strong ability to source deals ensures a consistent proprietary deal-flow of prime investment opportunities.
About the ChosunFund
ChosunFund is raising US$50 million to be invested in opportunities focused exclusively on the DPRK. It is structured as a limited company incorporated in Hong Kong, with investment into ChosunFund via ordinary shares combined with repayable loan shares. The objective of ChosunFund is 'cash flow with capital growth' with investors getting part of their money back initially through redemption of the loan capital, followed by dividends. ChosunFund will have an initial life of seven years. ChosunFund will target investment opportunities, typically in situations where there are existing operations, but that are constrained by a lack of capital, technology or access to international markets. ChosunFund is managed by an investment manager, AngloAsia Capital Management Ltd. Incorporated, in Hong Kong and wholly owned by KoryoAsia. The board of AngloAsia comprise of representatives from KoryoAsia who, in addition to themselves, will appoint a group of independent directors to collectively make up the board of ChosunFund. The Board of ChosunFund conducts all investment decision-making.
About North Korea
The DPRK embarked on economic reforms designed to allow it to engage with the market-based outside world along lines generally, if not exactly, like those adopted by China. The DPRK is pursuing a controlled opening to commerce and is seeking foreign capital. Abundant natural resources, a well educated work force with good basic technology skills and highly competitive cost structures, as well as the DPRK's location in the vibrant Northeast Asian economic growth region, offers a wide variety of economic opportunities. The DPRK has substantial known mineral reserves as well as significant forest product capacity. Major industries include metallurgy and heavy machinery, trucks, locomotives, heavy construction equipment, cement, synthetic fibres, fertilisers, and the refining of gold, copper, lead, zinc, and aluminium. Neighbouring states are interested in oil and natural gas pipelines as well as transportation links that are proposed to pass through the DPRK. In June 2008, the US lifted the application of the Trading with the Enemy Act and rescinded North Korea's designation as a State Sponsor of Terrorism in October 2008.