Hong Kong-based private equity firm, AFC Investments Ltd. announced plans to invest between US$10 million and US$20 million in start-ups, along with medium and large scale companies involved in agriculture and food processing in Malaysia, and plans to expand its future investments to include Singapore.

 

The decision to commit has been sparked by the dual drivers of the growing Chinese population and the climbing demand for food according to AFC chief executive, Steven Fong.

 

“This is one of our initiatives to not only make capital injections, but also help businesses export to China,” the Rakyat Post reports he said at an introductory briefing by AFC to Malaysian companies.

 

AFC Investments was established by the Chinese Academy of Agricultural Sciences with an initial corpus of US$175 million. To date the firm has completed over 70 successful investments in 30 companies and manages a portfolio of asset worth more than 8 billion yuan (US$1.26 billion).

 

Mr. Fong states that the firm has a plan in place to control the risk associated with each investment given the current economic conditions in the region, but adds that considering the sectors that the fund invests in, the risks are somewhat inherently mitigated.

 

“We understand that there is a slowdown in economies and devaluation of different currencies, but at the end of the day we are talking not only about commodity products but necessity products. The effect is not as crucial as expected,” he notes.