Finnish Fund for Industrial Cooperation Ltd. (Finnfund)
Organizational profile: Finnfund is a Finnish development financier which builds a sustainable world by investing in responsible and profitable businesses in developing countries They provide companies operating in developing countries with longterm risk-financing and expertise required for sustainable investments. Finnfund expect their projects to be profitable, sustainable and generate positive development impacts in the target country. Finnfund gets its financing from the Finnish state, private capital markets and return on its investments. At least fifty-one per cent of Finnfund shares must always be in the immediate ownership of and administered by Finland. The purpose of Finnfund is not to generate a profit for the shareholders.
Finnfund puts special emphasis on sectors critical to sustainable development, such as clean energy, sustainable forestry, sustainable agriculture and financial services, but they invest in other sectors as well. Sustainable forestry has long been one of Finnfund’s focus areas. At the end of 2018, their investments in forestry represented 18% of the total portfolio. At present Finnfund has invested some 160 million euros in 13 forestry companies and forestry funds.
Financing Instrument: Equity, Mezzanine Financing, Debt
Project scale: Ticket size varies from one million to 25 million euros.
Recipient countries/regions/country groups: Global
Recipient categories: Businesses
Eligibility Criteria: In order to be eligible for Finnfund investment, the project has to be implemented responsibly, target a developing country as defined by the OECD, generate measurable development impacts and be financially profitable. Finnfund is always a minority shareholder and the terms of exit will be set in advance. Typically exit is implemented so that the project sponsor acquires Finnfund’s share in the company within 5 to 7 years. Loans typically have long maturities varying from 5 to 10 years. Guarantees are defined based on the risk, amount of financing and other factors.
Finnfund expects all its investments to be profitable, environmentally and socially responsible and produce measurable development impact in their target countries. They only invest in privately owned businesses.
Application guidelines: You can seek financing by sending Finnfund an informal application. For project appraisal, Finnfund will need a project plan developed by the client. There is no standard application form for Finnfund financing. The basis of their appraisal is our client’s project plan.
The investment process has five stages:
1. Contact Finnfund’s investment team
The appropriate contact can be found here: https://www.finnfund.fi/en/investing/looking-for-an-investor/
2. Present your project plan
3. Assessment of environmental and social responsibility
4. Development impact assessment
5. Investment decision