Funds

Lower Volga Regional Venture Fund

Management: Bolshoi Management, an affiliate of Russia Partners Management (assumed management responsibility in 1999)

The Lower Volga Regional Venture Fund ("LVRVF") was required to invest at least 75% of its capital in the following Russian cities: Samara, Saratov and Volgograd. The LVRVF primarily invested in small and medium-sized companies with up to 5,000 employees, good management, significant growth prospects and a focused core business that did not require substantial restructuring.

The LVRVF's investment objective was to secure a return on equity capital provided to eligible enterprises in order to finance commercially viable investment projects and thereby to contribute to the restructuring and development of the economy of the region.

Russia Partners inherited management of the LVRVF portfolio for the EBRD (European Bank for Reconstruction and Development) in 1999 after $18 million of capital had been invested. Subsequent to assuming management of the portfolio, Russia Partners invested an additional $12 million of the fund’s capital into three new investments, all of which have performed at or above expectation. The fund is now fully realized at values substantially above the fair value of the portfolio assets at the time Russia Partners assumed control.