New DEG private equity fund-of-funds
The fund is intended to facilitate institutional investors’ access to high-growth markets.
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DEG Impact, a subsidiary of German development finance institution DEG, is launching a new private equity fund-of-funds. The industry magazine Portfolio Institutionell has published a detailed feature on the plans for the Global Growth Guarantee Fund (3xG Fund). The article outlines how the fund is intended to facilitate institutional investors’ access to high-growth markets in developing and emerging economies.
The 3xG Fund is a private equity fund-of-funds that invests in selected target funds in emerging markets. These, in turn, provide capital to fast-growing local companies. This structure is designed to give investors diversified exposure to emerging markets while taking into account both return potential and development impact. The focus is on regions such as Asia, Africa, and Latin America.
A central feature of the new fund is an EU guarantee covering up to one-third of the fund-of-funds’ capital. It is intended to help mitigate risks, especially during the early investment phase. For investors, this is expected to enhance the attractiveness of investing in emerging markets. The 3xG Fund is designed as a long-term vehicle, targeting a volume of up to €300 million and broad diversification across multiple target funds and regions.
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