Thursday, August 17, 2017

Myanmar Investments raises $20 million in London as it lines up projects

Myanmar Investments International Limited (MIL) raised US$19.94 million on the AIM market of the London Stock Exchange yesterday, as the company lines up several potential new investments in Myanmar, according to managing director U Aung Htun.

MIL is one of just a handful of internationally listed, Myanmar-focused companies, also including Yoma Strategic Holdings, chaired by Serge Pun, and tech startup MySquar. On July 21, MIL issued 17.34 million new ordinary shares at $1.15 per share, which will begin trading on July 24.

“When we think we are in sight of getting an investment done, we will fund ourselves,” said U Aung Htun. “There are around 10 deals that we are quite serious about, of different sizes. We are not sure precisely when they will happen, or in which order, but it’s possible if certain deals come together that we may even have to go back to the market [to raise more].”

He did not want to comment on the prospective deals, but said that MIL is looking at opportunities across a large number of sectors, including telecoms and information technology, finance, healthcare and education.

“We look for really good management in sectors where there is real demand. In Myanmar, there is a big need for infrastructure, electricity, water, power as well as consumer products and services. We see a need in many sectors and in each case would look at the top two or three players,” he said.

Typically MIL is looking to make investments between $5 million and $10 million, he said. “That’s the sweet spot – but we can do anything from less than $1 million up to $20 million.”

“We have looked at more than 100 opportunities – that’s an average of one a week. However, there are some issues that are a little complicated,” said U Aung Htun.

For example, a number of companies don’t fully appreciate the due diligence process, he said. “A lack of ready records and documents can make things complicated. We also prefer to back people with comprehensive business plans who have thought through all of the aspects of their business.” In this regard, he said, more competition is welcome as it helps to develop the market.

Since MIL opened in 2013 it has made one investment in Myanmar, a 55 percent stake in a joint venture microfinance company, in August last year.

“We were deliberately low -key in our first year, as we needed to learn and to get our feet wet. Now we are beginning to raise our profile,” said U Aung Htun. MIL went on a roadshow earlier this year, to the UK, Switzerland, Hong Kong and Singapore, he said, to raise investor awareness.

“Sophisticated investors are beginning to understand Myanmar more. Our role is to educate, and they do believe that reforms have progressed – we were able to convince them of that.” Two major investors in this round of fundraising were Hong Kong-based hedge fund LIM Advisors and global asset manager First State Investments.

MIL plans to continue to return to the market and grow its investor base, said U Aung Htun. “In 10 years we hope to grow to the company to around $200 million – or more,” he said.