As at June 2018,2 a total number of 125 private equity funds (PEFs) had been incorporated in Colombia,3 25 of which were at the fundraising stage and 14 of which were at the liquidation stage. As at June 2018, a total of US$16.57 billion had been raised in capital commitments to invest in Latin America, in comparison to a total of US$14.72 billion raised as at June 20174 and US$924 million raised by the total number of PEFs in place prior to 2010.5
Of the 111 active PEFs, 37 are buyout funds (33.3 per cent), 29 are real estate funds (26.1 per cent), 19 are infrastructure funds (17.1 per cent), 14 are venture capital funds (16.6 per cent), nine are environmental and social impact initiatives funds (8.5 per cent) and three are natural resources funds (2.8 per cent).6
i Deal activity
From 2005 to June 2018, PEFs carried out 701 investment transactions, compared with a total of 607 investment transactions as at June 2017. The preferred industries for investments have been mining and energy (US$4.13 billion), real estate (US$2.94 billion) and infrastructure (US$662.1 million). Other sectors in which PEFs have invested are oil and gas, services, health, retail, financial services, manufacturing, transportation and logistics, agroindustry and information technology (IT). The amounts invested during this period were equal to US$10.75 billion.7
The following table shows the number of transactions carried-out by each type of PEF and the invested amounts:8
|Type of fund||Number of transactions||Invested amounts|
|Real estate||429||US$3.11 billion|
|Natural resources||57||US$361.2 million|
|Environmental and social impact initiatives||18||US$36 million|
|Venture capital||75||US$32 million|
In 2018, Colombia was ranked by the Association for Private Capital Investment in Latin America (LAVCA) as the third most dynamic Latin American private equity/venture capital (PE/VC) market in terms of number of deals, surpassed only by Brazil and Mexico, reporting 41 investment transactions that took place in 2017, in comparison to the 22 transactions registered in 2015. In total, US$772 million were invested in those 41 transactions, which represents a US$324 million increase compared to the US$448 million invested in 2016.9
As regards recent trends in PE transactions, infrastructure projects continued to be one of the main growing focuses of PE investments in 2018. In this respect, the Canadian PEF Caisse de dépôt et placement du Québec (CDPQ) and the governmental financial entity Financiera de Desarrollo Nacional (FDN) announced the launch of a fund that will invest approximately US$ 1 billion in infrastructure projects, of which approximately US$500 million will be invested by CDPQ.
Additionally, BlackRock, Ashmore and UPLI participated in the financing of the 4G toll road projects Transversal del Sisga and Ruta del Cacao. In the Transversal del Sisga project, BlackRock and Ashmore Group acted as senior lenders, and for Ruta del Cacao, BlackRock and UPLI acted as senior lenders on the project, while Ashmore was one of the sponsors and shareholders of the concessionaire developing the project.
Other trends show substantial growth in recent years in the IT sector, which historically had not been so significant. However, in 2016 and 2017, the IT sector had the largest number of closed deals (nine of the 22 deals in 2016, and 17 of the 41 deals that took place in 2017). Futhermore, in 2017, US$183 million (41.5 per cent of the total invested by PEFs) was invested in IT, compared with US$160 million invested in 2016 and US$1 million in 2015.10
Also of note was that 13 of the 41 deals closed in 2017 were related to early-stage assets, while US$423 million was invested in assets at a growing finance stage.11
Finally, four exits occurred in 2017 in comparison to the six exits reported in 2016.12
ii Operation of the market
While secondary buyouts and trade sales have been identified as the most important exit routes for PE/VC investments in Latin America,13 there is no standard sales process for PE divestitures in Colombia, and the overall duration of buyouts and trade sales will depend to a large extent on, inter alia, transaction complexity, number of intervening parties, regulatory approvals and financing schemes (if applicable).
Management equity incentive arrangements, on the other hand, will depend on the specific provisions in private placement memoranda governing remuneration of general partners (GPs), and on the terms and conditions of engagement of the GPs with the relevant funds. Therefore, a correlation between carried interest arrangements and duration of trade sales and buyouts is hard to establish.
ii LEGAL FRAMEWORK
Under Colombian law, PEFs are a special type of collective investment fund (CIF) governed by Decree 2555 of 2010 (Decree 2555). CIFs are defined as collective investment vehicles funded by capital or other in-kind contributions made by limited partners (LPs). Funds raised through a CIF are managed and invested in accordance with the investment objectives and policies set out in the CIF's private placement memorandum. Participation units and voting rights are allocated to LPs on the basis of their individual contributions to the CIF.
PEFs, in turn, are CIFs in which at least two-thirds of LPs' capital commitments are invested in equity or debt securities other than those registered in the National Registry of Securities and Issuers. An LP's capital commitment in a PEF must equal at least 600 minimum monthly wages under Colombian law for the LP to acquire participation units and voting rights in the fund. In addition, PEFs have a fixed-term focus that requires LPs to commit their funds for a minimum period.14
All CIFs, including PEFs, must be administered by qualified institutions under the supervision of the Colombian Superintendence of Finance (SFC). Trust companies, broker-dealers and investment management companies are the only types of regulated institutions authorised to administer PEFs in accordance with the provisions of Decree 2555. These institutions, referred to collectively as PEF administrators,15 perform PEFs' back-office duties. Among other duties, PEF administrators must:
- deliver portfolio securities to the designated custodians, if applicable, and provide those custodians with all information required for the adequate performance of their custodial duties;
- perform periodic portfolio valuations in addition to the periodic valuation of PEFs' participation units;
- keep separate accounting records for each PEF under their administration;
- comply with certain reporting duties before LPs and local regulators (namely the SFC and the Colombian self-regulatory organisation of the securities market, the AMV);
- design, approve and execute corporate governance policies required in connection with PEF administration duties;
- exercise all voting rights attached to the portfolio securities under their administration; and
- appoint portfolio managers, as applicable.
Generally, a CIF's portfolio management and investment advisory duties may be performed directly by the CIF administrator, or may otherwise be performed by an external or foreign portfolio manager appointed by the CIF administrator. As with CIF administrators, only trust companies, broker-dealers, and investment management companies under SFC supervision may be appointed as CIF external portfolio managers.
The appointment of an external or foreign portfolio manager does not release the CIF administrator from its liability in relation to LPs. On the contrary, the CIF administrator will be liable to the SFC and the fund's LPs for the selection and appointment of an external or foreign portfolio manager. The CIF administrator's liability will be at stake in the event of slight negligence in the performance of its functions.
In addition to an external or foreign portfolio manager, the CIF administrator (or the external or foreign portfolio manager, as the case may be), must appoint an individual to act as the CIF's general manager. In the case of PEFs, however, appointment of a general manager will not be required in the event that a GP has already been appointed. Selection criteria for the appointment of a general manager or GP must be included in the fund's private placement memorandum.
Unlike CIF external portfolio managers, GPs do not have to be regulated institutions under SFC supervision. This regulatory distinction between GPs and external portfolio managers is justified by the nature of PEFs' investments (as at least two-thirds of the funds are invested in unregistered securities). The unregulated nature of a GP is further offset by the appointment of a PEF supervisory committee in charge of overseeing the GP's performance of its duties and ensuring compliance with applicable laws and regulations.
The general manager or the GP, as applicable, will be in charge of performing the fund's portfolio management duties on behalf of the PEF administrator. Portfolio management duties include deciding on the fund's investments and divestitures in addition to identifying, measuring, controlling and managing all risks associated with the fund's portfolio investments. In performing its portfolio management functions, the GP will be supported by the fund's investment committee, which will be responsible for the analysis of investment and divestiture decisions, the definition of investment caps, and the implementation of policies governing the acquisition and liquidation of portfolio investments. While PEF administrators will remain liable up to slight negligence for the appointment and supervision of GPs, the latter will bear full responsibility for the relevant funds' investment decisions.
Finally, under Colombian law, GPs may also acquire participation units in a PEF under the terms and conditions set out in the fund's private placement memorandum.
i Acquisition of control and minority interests
A PEF's controlling investment in a portfolio company is subject to the laws and regulations governing the acquisition of control and majority shareholders' rights and obligations. A number of private placement memoranda state that the GP will aim for all or most of its portfolio investments to grant the fund a controlling stake (whether directly or indirectly) in the relevant portfolio companies without fully excluding the possibility of acquiring minority interests.
Law 222 of 1995 (Law 222) provides that a company will be considered to be under the control of a majority shareholder if that company's decision-making power is subject, directly or indirectly, to the will of one or more third parties considered to be controlling entities. While not precisely intended to include PEFs or CIFs in general, the provisions of Law 222 are currently deemed to be binding, mutatis mutandi, upon corporations and CIFs (including PEFs), regardless of the latter's non-corporate nature.
As such, a portfolio company will be under a PEF's controlling investment in the event that:
- 50 per cent or more of the portfolio company's issued and outstanding capital stock is held by the relevant PEF, whether directly or indirectly;
- the relevant PEF has the right to issue the number of votes required to reach a minimum voting majority in the company's shareholders' meeting or equivalent corporate body, or the requisite number of votes to appoint the majority of the company's board of directors; or
- the relevant PEF exercises a prevailing influence over the decisions taken by the portfolio company's corporate bodies.
Controlling shareholders have two main obligations with respect to corporate law matters: they must register their control situation before the mercantile registry kept by the competent chamber of commerce in the controlled company's corporate domicile;16 and they must prepare consolidated financial statements to report the financial situation, results of operations, and changes in equity and cash flows of the controlling entity and the controlled company as if they were a single entity.
Should a GP hold a controlling stake in a portfolio company, it must further comply with the relevant provisions of the company's by-laws in the event it intends to conclude a full or partial exit of its portfolio investment. Among other things, rights of first refusal in the negotiation and transfer of shares and rights of withdrawal, in addition to drag-along and tag-along provisions are common, and in many cases are standard clauses in by-laws and shareholders' agreements. If, on the contrary, a PEF holds a minority interest in one of its portfolio companies, the foregoing provisions will afford additional protection to minority shareholders.
Other limitations imposed upon controlling shareholders include the existence of super-majorities provided for by law, as in the case of stock corporations,17 or otherwise set out in a portfolio company's by-laws.
Finally, in the event that the fund's GP is domiciled abroad, a special power of attorney must be granted in favour of a third party to act on behalf of the GP in Colombia for all legal purposes. Should a foreign GP acquire participation units in the PEF for which it has been appointed portfolio manager, the GP must register its foreign portfolio investment with the Colombian Central Bank by completing and filing foreign exchange forms to be submitted to foreign exchange intermediaries (local banks) in the PEF's jurisdiction of incorporation. A similar procedure must be followed upon redemption of the GP's participation units in the relevant PEF.
ii Fiduciary duties and liabilities
A GP's representatives on a portfolio company's board of directors will be deemed to be managers under Law 222.18 The GP's representatives owe several fiduciary duties to the portfolio company and its shareholders.
Under Law 222, company managers, including board of directors' members, shall at all times act in good faith and seek to benefit the company's interests and the interests of its shareholders, their standard of diligence being that required from a good businessperson.
In performing their duties, company managers and directors must:
- direct all their endeavours to the adequate fulfilment of the company's corporate purpose;
- aim for strict compliance with all relevant legal provisions in addition to the provisions of the company's by-laws;
- ensure adequate performance of the statutory auditor's duties;
- preserve and protect the company's trade secrets and other confidential information;
- refrain from misusing privileged information;
- afford equitable treatment to all company shareholders and respect the exercise of the shareholders' inspection rights; and
- refrain from participating, whether directly or indirectly, and with the purpose of fulfilling a personal or third-party interest, in any competing business activity or in any other activity that may give rise to a conflict of interests, unless specifically authorised by the company's shareholders' meeting or corporate body competent for that purpose.
Law 222 further provides that company managers and directors will be jointly and severally liable before the company, its shareholders and third parties for any damage caused as a result of their negligence or wilful misconduct. Company managers and directors who are unaware of the acts or omissions giving rise to such damage, or who otherwise voted against the approval of the relevant acts or decisions and did not later execute them, will not be subject to the foregoing liability standard.
Conversely, directors' and managers' negligence will be presumed in the event of abuse of office or any other breach of managers' and directors' duties, or in the event of a breach of the company's by-laws or applicable laws and regulations.
In the event that an individual director's liability is compromised, the company may file a corporate responsibility suit, provided that the filing has been previously approved by the company's shareholders' meeting with a simple voting majority. A successful corporate responsibility suit will entail removal of the corresponding director. If, however, the company does not proceed with the corporate responsibility suit within three months of approval of the filing by the shareholders' meeting, the company's statutory auditor or any other company director may enforce the claim.
Similarly, the company's creditors may also exercise the corporate responsibility suit against directors, provided, however, that the creditors represent at least 50 per cent of the company's external liabilities and that the company's equity is insufficient to pay for all the company's outstanding obligations. Filing of a corporate responsibility suit does not preclude enforcement of individual rights held by the company's shareholders and other affected third parties against defaulting directors.
Finally, domestic industry standards and current market practice evidence contractual limitations to both GPs' liability and the liability of GP-appointed directors in portfolio companies by way of comprehensive insurance policies paid for by PEFs. Insured risks include, inter alia, third-party damage caused by GPs in performing their portfolio management functions (including damage caused to PEF administrators and LPs); third-party damage caused by GP-appointed managers and directors in portfolio companies (including damage caused to the relevant portfolio companies, their shareholders, creditors, or other portfolio company managers); and labour practices and labour-related damage inflicted upon third parties by GPs or GP-appointed managers and directors.
iii YEAR IN REVIEW
i Recent deal activity
In addition to the general considerations and specific deals described above (see Section I), it is worth mentioning that buyouts and growth financing remain the most popular PE/VC investment strategies in Latin America.19 Colombia's recent deal activity is a clear example of this. Thus, of the 41 deals occurring in 2017, 11 were buyouts and 12 were growth financing. Furthermore, of the US$772 million invested in 2017, US$253 million was invested through buyouts and US$423 million through growth financing.20
Pension funds are the most important investors in Colombian PE/VC funds, followed by other financial institutions. As at June 2018, 41.5 per cent of PE/VC investors were pension funds, while 20.6 per cent were corporate investors.Insurance companies and banks held 5.9 per cent and 5.1 per cent respectively of PE/VC equity interests and the remaining 23 per cent was held by other investors, such as high-net-worth individuals (4.9 per cent), family offices (4.6 per cent), multilateral institutions (4.2 per cent), funds of funds (4 per cent), multi-family offices (3 per cent), sovereign funds (2.6 per cent) and endowments (2.3 per cent).21
During the period January 2005 to June 2017, 66.5 per cent of the investors were local investors while 33.5 per cent were foreign investors. These figures, compared with those of 2014 (81 per cent local investors compared with 19 per cent foreign investors) and those of 2016 (72.4 per cent local investors compared with 27.6 per cent foreign investors) show an increase of foreign investors' stake in Colombian PE/CV funds.22
The most common financing schemes for PE/VC transactions include leveraged buyouts and syndicated loans.
One of the most recent examples was the syndicated financing granted by Sumitomo Mitsui Banking Corporation, Export Development Canada, Scotiabank and Itau CorpBanca Colombia to the Canadian PEF Brookfield Infrastructure Partners LP for the acquisition of a controlling stake in Gas Natural's Colombian interests for a purchase price of approximately US$590 million.
Other notable examples include Darby Private Equity's acquisition of a minority stake in and transportation rights from Ocensa, which was made possible by way of a credit agreement with Itaú Unibanco Nassau Branch. Collateral over the purchaser's shares was granted in favour of Itaú Unibanco and escrow accounts were established to further guarantee debt repayment. A syndicated loan was also granted by Itaú Unibanco Nassau Branch and Banco Davivienda in favour of Terranum to finance its acquisition of Decameron Hotels & Resorts. A syndicated loan was granted in favour of Altra Investments, Mercantil Colpatria and SCL Energía Activa to finance their joint acquisition of Termovalle SA ESP, and a syndicated loan was granted by Bancolombia, Bank of Tokyo and Banco Santander to finance Colombian electricity generator Celsia SA ESP's acquisition of several power plants in Costa Rica and Panama.
Legal restrictions to be considered in structuring financings of PE transactions include the prohibition on entities under SFC supervision financing the acquisition of a controlling stake in a portfolio company with funds received from the general public (clients), and the prohibition on commercial banks facilitating loans aimed at acquiring a majority interest in an entity that falls under SFC supervision.
iii Key terms of recent control transactions
Canadian PEF Brookfield Infrastructure Partners LP acquired 53.11 per cent of the equity interest in Gas Natural in Colombia for a purchase price of approximately US$590 million. The transaction was undertaken in two stages: in December 2017, the fund acquired from the Spanish firm Gas Natural Fenosa 11.22 per cent of the shares in Gas Natural in Colombia; the remaining 41.89 per cent of the shares were acquired through a public offering on the Colombian stock exchange.
In January 2018, MAS Equity Partners, through its vehicle MAS Equity Fund III, and Rocsa Colombia SA acquired 100 per cent of the shares of the Colombian chemical distributor Inproquim.
In August 2018, DST Global led investment of US$200 million in Colombian start-up Rappi. Rappi is an on-demand delivery company operating in Colombia, Argentina, Brazil, Chile, Mexico and Uruguay. In 2018, it joined the 'unicorn' club by being valued at US$1 billion; other PE/VC funds, such as Sequoia Capital and Andreessen Horowitz have invested in the company.
In December 2018, the British fund Alpha Blue Ocean acquired from Colombian fund Tribeca Partners 100 per cent of the equity interest of the Colombian company Onda de Mar; Australis Partners acquired from Advent International and Organización DeLima 50 per cent of the equity interest in Alianza Fiduciaria (one of the largest trust companies in Colombia); and the PEF Aqua issued a letter of intent with the controlling shareholders of the Colombian financial entity Financiera Dann Regional, pursuant to which the fund will become the controlling shareholder of the company following certain investments in the company to be undertaken within the next two years.
Colombia reported the second-largest amounts generated by exits in Latin America during 2017 (US$309 million through four exits), surpassed only by Brazil (with US$2.5 billion through 27 transactions). Nonetheless, both in number of exits and the amounts these generated, Colombia saw a substantial decrease compared with the 2016 figures (US$1 billion through six exits).23 Nonetheless, during the first half-year of 2018, nine exits were reported, showing a significant increase in comparison with 2017 and 2016.24
Recent notable exits in 2017 and 2018 include the following. In April 2017, Nexus Capital Partners divested its investment in Airplan SA and Aeropuertos de Oriente SAS in a deal that saw Grupo Aeroportuario del Sureste acquire 92.42 per cent of the equity interest in Airplan SA and 97.26 per cent of the equity interest in Aeropuertos de Oriente SAS for a total amount of US$262 million.
In May 2017, Rural Impulse Funds I and II (vehicles of Belgium's Incofin Investment Management) sold 55.2 per cent of the equity interest in Crezcamos SA.
In January 2018, the PEF Valorem sold to DHL Supply Chain 100 per cent of the equity in the Colombian logistic services supplier Suppla group. The purchase price was within the range of US$50 million to US$60 million.
In April 2018, the Colombian PEF Altra Investments agreed the transfer of Colombian packaging company Proenfar to Weener Plastics Group.
In September 2018, the PEF Fondo de Capital Privado MAS Colombia LatAm transferred to the Peruvian group Auna (through its Colombian vehicle) 97 per cent of the equity interest in the company Promotora Médica las Américas for a purchase price of approximately US$140 million.
As noted above, in December 2018, Tribeca Partners and Advent International divested their participation in Onda de Mar and Alianza Fiduciaria respectively, while in January 2019, The Indian company Taghleef acquired from the fund Valorem and from Lisa Holdings 100 per cent of the equity interest in the Colombian company Biofilm (a biaxially oriented polypropylene manufacturer).
iv REGULATORY DEVELOPMENTS
In terms of regulatory oversight, PEF administrators are permanently subject to supervision by the SFC. As such, PEF administrators must comply with all applicable laws and regulations governing their permitted activities (which will in turn depend on their specific legal nature under the Organic Statute of the Financial System), and further comply with their PEF administration duties in the terms set out under Decree 2555 and other complementary regulations.
Fund formation is also subject to special controls by the SFC. While a prior authorisation is not strictly required, all PEFs must be registered with the SFC. To register, the PEF administrator must file the PEF's private placement memorandum and other supporting documents with the SFC. As of this filing, the private equity fund is entitled to start operations. Nonetheless, the SFC may subsequently provide its comments or objections to the private placement memorandum, if any, in due course. In the absence of any comments or objections from the SFC, or following their incorporation or reply in the private placement memorandum, the SFC will issue a resolution assigning a specific code (or ID) to the relevant fund. Following the issue of this resolution, the fund will be ready to start its operations, which will at all times be subject to the provisions of the fund's private placement memorandum.
PE transactions and GPs' activities are subject to several internal corporate governance controls, such as the oversight functions performed by the PEF administrator and the PEF's surveillance committee over a fund's GP. In addition, PE transactions (both portfolio investments and divestitures) are to a large extent subject to the analyses of investment and divestiture decisions carried out, and the recommendations issued by, a fund's investment committee.
On the other hand, the most recent regulatory developments relating to PEFs have been undertaken by the Financial Regulation Unit (URF), a special dependency of the Colombian Ministry of Finance and Public Credit (MHCP), since its inception in 2013. Other private initiatives, such as the creation of the Colombian PEF Trade Association (Colcapital), further contribute to an effective interplay between relevant market players and local regulators in the design and approval of new regulations governing the fundraising, administration, corporate governance and investment regime of PEFs.
A non-exhaustive list of both recent regulatory developments and draft regulations currently under discussion includes:
- Decree 765 of 2016, whereby the MHCP modified pension funds' investment regime to:
- reorganise admissible assets in accordance with a risk-based approach, allowing segregation of traditional assets and alternative assets;
- introduce a new category of assets – 'restricted assets' – aimed at contributing towards the diversification of risks associated with pension funds; and
- modify investment caps and requirements for currently admissible assets, especially for investment vehicles incorporated by foreign issuers;
- include local and foreign real estate PEFs as eligible assets in which those entities may invest;
- replicate the constraints and restrictions applicable to pension funds with respect to investments in PEFs whose main assets are infrastructure projects; and
- modify the maximum percentage that insurance companies can allocate in PEFs;
- express authorisation for PEFs to carry out certain operations, such as the issuance of bonds in the stock exchange and the granting of financings; and
- a requirement for the valuation of the PEF's portfolio to be made by the GP (previously a duty of the PEF's administrator); and
Of the reforms introduced by Law 1943 of 2018, the most relevant for the private equity market is the amendment of the tax deferral regime applicable to private equity funds income. Under the former regime, all fund earnings were subject to a tax deferral since tax was levied at the moment those earnings were distributed to the LPs. Under the new regime, this tax deferral applies only with respect to (1) funds listed on the stock exchange; or (2) funds that do not have a person owning, directly or indirectly, more than 50 per cent of the fund's equity interest or a beneficial owner or LP with control at this level of interest to approve the distribution of earnings. To qualify for the tax deferral regime, PEFs set up prior to 31 December 2018 must comply with these requirements by June 2020.
While the investment landscape in Colombia remains dynamic, a comprehensive look ahead at PE and VC deals and regulatory developments must weigh up the following considerations.
It is expected that the vast majority of Latin American LPs will have PE infrastructure investments in the continent within the next couple of years.25 Considering the government's continuing initiatives to raise and allocate resources, such as the initiative to open a PEF to support the development of 4G infrastructure projects, Colombia is no exception to this regional trend.
Although, in the wake of the 2008 global financial crisis, approximately one-third of LPs have invested in the Latin American-focused debut funds of new GPs,26 the scarcity of established GPs is still seen as the biggest deterrent to new investors in Latin America.27 In the case of Colombia, the number of new GPs created in 2017 (four) and in the first half-year of 2018 (one) is lower than the number of GPs created each year since 2007.28 Perceptions about exit barriers, regulatory burdens, currency fluctuations and constant tax reforms may further jeopardise LPs' willingness to invest in Colombia-based PEFs.
In spite of the foregoing, the stronger interplay between policymakers (such as the URF and the SFC), industry practitioners and trade associations (Colcapital) has favoured the ongoing revision and improvement of existing regulations governing PEFs and PE transactions.29 A special focus on reforms to pension fund investment regimes with a view to adapting to international practices and industry standards is particularly noteworthy in this regard. Successful regulatory developments in this area may significantly enhance fundraising strategies.
Finally, in recent years, the number of foreign GPs (in comparison to local ones) has increased. Thus, while in June 2017 only 49.2 per cent of GPs were foreign, by June 2018, this figure was 53.8 per cent.30
1 Hernando A Padilla is a partner and Pedro Arango is an associate at Philippi Prietocarrizosa Ferrero DU & Uría.
2 This chapter aims to include the most up-to-date information available at the time of writing. Note, however, that certain information is only available up to a cut-off date of 31 December 2017 (information included in the report of the Association for Private Capital Investment in Latin America (LAVCA) – '2018 LAVCA Industry Data & Analysis'; see footnote 9) or 30 June 2018 (EY–Colcapital 2018 report; see footnote 3).
3 Ernst & Young and Colcapital (2018), 'Potenciando la economía colombiana: Evolución y análisis de la Industria de Fondos de Capital Privado: Reporte 2018', pp. 45–47.
4 Ibid., p. 56.
5 Bancóldex (2015), 'Catálogo Fondos de Capital Privado y Emprendedor 2015–2016', p. 7.
6 See footnote 3, pp. 50–59.
7 Ibid., pp. 65–66.
8 Ibid., p. 65.
9 LAVACA (2018), '2018 LAVCA Industry Data & Analysis: Update on Latin American Private Equity & Venture Capital', p. 5.
10 Ibid., p. 25.
11 Ibid., p. 24.
12 Ibid., p. 26.
13 LAVCA and Coller Capital (2015), 'Latin American Private Equity Survey', p. 8.
14 However, a PEF's private placement memorandum may also set out special terms and conditions governing early or partial redemption of LPs' participation units.
15 These institutions are also referred to collectively as CIF administrators in the event that the relevant CIF is not a PEF.
16 The PEF, and not the PEF administrator or the GP, will appear in the portfolio company's mercantile registry as the company's controlling shareholder, as stipulatd by the SFC in Concepto 2012101056-001 dated 14 January 2013.
17 These super-majorities are required in, inter alia, stock corporations, to decide on the distribution of profits below the minimum percentage required by law, to waive pre-emptive rights in the issuance of new shares and to pay dividends in kind.
18 The relevant provisions of Law 222 regarding directors' liability and other corporate matters have been incorporated into the Colombian Commercial Code.
19 See footnote 9, p. 22.
20 Ibid., p. 24.
21 See footnote 3, p. 50.
22 Ibid., p. 51.
23 See footnote 9, p. 9.
24 See footnote 3, p. 69.
25 See footnote 13, p. 9.
26 Ibid., p. 9.
27 Ibid., p. 4.
28 See footnote 3, p. 38.
29 See footnote 13, p. 12.
30 See footnote 3, p. 44.