March 25, 2014

Tuesday, March 25, 2014
By Yasmine Yahya

TEMASEK-linked Dymon Asia Private Equity (DAPE) has made its second investment in a home grown firm, as it seeks to build a stable of leading small and medium-sized enterprises (SMEs) from various sectors. DAPE has pumped $15 million into Singapore-based company HSL Constructor, a marine civil engineering and construction firm. DAPE is an arm of Dymon Asia Capital, a Singapore-based investment management company which manages about $4.2 billion in assets.

DAPE has a target fund size of $300 million and mandate to invest in promising SMEs in Singapore and South-east Asia – companies at the forefront of their respective sectors. In January, DAPE made its first investment, injecting $15 million into local interior furnishings company Goodrich Global

Heliconia Capital Management, wholly owned by Temasek Holdings, provided $100 million in seed capital to the fund.

Dymon Asia founding partner Keith Tan said he has known the managers of HSL since 2003, but it took the fund close to one year to court them. “We are attracted to HSL because it has a strong track record, vivid vision, plausible growth plans and staunch social strategy,” he said. “Not only is HSL’s financial status assuring, it’s growth plans are both promising and inspiring.” HSL chief executive Charles Quek said the company was very keen from the start to tie up with Dymon and DAPE, but did not want to rush into it as he wanted to make sure the relationship could last a long time.

“We wanted Dymon to know exactly how we conduct our business, our culture and values,” he said. “So over the one-year period, we brought them to our projects here and in Jakarta, brought them to visit our partners in China, got them to meet our customers and management. “We also got to know Dymon’s management team, shared our plans with them and they shared theirs with us, and after almost a year, we really felt compatible.”

The $15 million investment, which will buy DAPE a stake of about 20 per cent in HSL, will come in handy as the latter ramps up its overseas expansion, Mr Quek said. Part of the fund will go towards buying equipment that will allow the company to win bigger projects across the region.

HSL is also looking at acquiring companies in Asia to expand its footprint and capabilities, and DAPE’s investment will help to fund this, Mr Quek said. “I think their expertise in capital markets, their financial know-how, could be a strength that complements us very well,”

“We are after all, a construction company, we are all civil engineers. If we can marry our engineering capabilities with their financial skills, we can really create a lot of opportunities.”

Source: The Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.

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