Following the landmark mid-July conclusion of negotiations between Iran and the ‘P5+1 countries’, the Frontera team sat down with the Managing Partner of Canton Hermidas, a multi disciplinary investment firm focused on Iran. With firmly established capabilities in asset management, private equity, and fund management, the investment house has big plans to help substantially widen the spectrum of western financial products and concepts presently available inside Iran.
At the moment the firm is prioritizing what is perhaps the greatest void within the market – private equity. Many believe locally based investment vehicles are the most feasible path for foreign investors to access the Iranian market in the immediate term. However, privately held financial services firms in Iran are extremely limited in number, and most have allocated very little resources toward developing capabilities in private equity and venture capital. This leaves only a handful of firms that can offer investors exposure to the Iranian economy in a manner that is fully compliant and structured to meet the standards of the international investment community. Canton Hermidas, having established Iran’s first private equity fund nearly eight years ago, is one of these few.
This is the second in a series of podcasts that Frontera will be conducting with some of the leading Iranian-focused asset managers, brokers, and investment funds.
In this podcast, we discuss how the fund management industry in the country is set to completely transform in the coming years. With significant investor interest in the Iranian economy following on the heels of the signing of the nuclear agreement, both the public and private sector financial institutions are scrambling to develop new asset classes. This means investors need to do their research carefully. Is there sufficient legislation covering financial products and investment classes such as venture capital and private equity? What type of legal advisory should one seek in advance? In what jurisdiction should investment funds be located to ensure investments are properly protected?
Tune in here to find out.
2:48 – Brief overview of Canton Hermidas
3:50 – What is the most viable entry point for foreign investors top gain exposure to the market today?
11:15 – What are the biggest challenges that inbound capital flows will face? Is the current Companies Law adequate? Are multiple jurisdiction special purpose vehicles necessary as a safeguard for investing?
13:53 – What are the bottlenecks brands will encounter when looking to access the vast Iranian consumer base?
17:58 – Aside from well-documented investment opportunities in basic areas such as trade and infrastructure, what other areas do you believe will receive significant attention?
21:47 – What areas do you believe will be prioritized by the government in terms of public investment projects once they can access the vast sums of liquidity currently parked overseas?
23:45 – Can investors negotiate with the government, and potentially qualify for various incentives on a project-by-project basis?
28:45 – How is the technology space performing? Is there any significant track record in this sector for investors to benchmark against? Have there been any successful exits?
30:26 – What would be your advice for interested parties in terms of a plan of action for the next 6-12 months as the prospect of eased sanctions nears?