The World Bank’s International Financial Corporation (IFC) will invest EUR 40 million in a fund to support the development of technology firms mostly in Poland and Romania, the World Bank announced on Friday.
The IFC will invest the money in Innova Capital, a private equity fund, the IFC explained in a press release.
The corporation said that thanks to the funds, medium-sized firms in Central and Eastern Europe would receive capital to support their activities and accelerate the pace of digitalisation. The investment is intended to, “help boost the resilience of the private equity market in the region amid the Covid-19 pandemic and at a challenging time for capital-raising in the region.”
The IFC added that it would invest the EUR 40 million in the Innova 7 private equity fund by Innova Capital, “a top-tier private equity fund headquartered in Poland,” to support tech firms mostly in Poland and Romania and to help them grow through acquisitions and market expansion.
“IFC’s support will channel much-needed funding to companies that face capital constraints, a growing problem given the global economic slowdown and geopolitical challenges in the region,” the IFC wrote in a press release.
“Through our continued partnership with Innova Capital, we aim to support mid-sized firms in the region in their effort to raise growth capital, improve governance, and embrace technological innovation” Ary Naim, IFC’s regional manager for Central and Southeast Europe, was quoted in the press release as saying.
Naim went on to say that the financing would, “help sustain investments and promote market recovery, at a time when both Poland and Romania are impacted by the war in Ukraine and are also called to play a key role in the post-war period.”
The IFC said it has been helping the development of private equity funds in Europe for over 20 years and has invested USD 470 million to date in 21 private equity funds in Central and Eastern Europe.