The partnership between trading house Mercuria and Envysion Wealth Management aims to fill the financing void in the commodities trading sector.
Geneva-headquartered Mercuria and Envysion have agreed to co-invest in mining and energy projects via a fund of up to $200 million, «Reuters» reported on Friday.
The scope of the agreement covers oil and gas, mining, and renewables projects, and the fund for the tie-up will be launched in around two months, Envysion CEO Veronica Shim told «Reuters.» Investments, expandable to $500 million, will initially be in the form of debt financing but can go beyond debt in future, she said.
Lack of Funding
The agreement comes as funding for commodity traders has dried up in the city-state following major defaults by Hin Leong and Zenrock in 2020. SocGen and ABN Amro, which had large exposures to the firms, have closed their Singapore-based commodities trading desks, while other banks have scaled-down operations considerably.
«Private funds are sitting there looking for higher returns but they lack financing channels,» George Liu, Mercuria’s Singapore-based business development manager said, «Reuters» reported.
Growth Ambitions
Envysion was set up in January 2020 by Shim, a former EFG Bank and Julius Baer managing director. The firm manages family wealth in North and Southeast Asia, and aims to reach $1 billion in assets under advisory in 2021, with and has an additional $1.9 billion in the immediate pipeline.
Privately owned Mercuria is one of the world's largest independent energy and commodity groups. The company recorded a net income of $425 million in the first half of 2020, up more than $100 million from the same period the year before, according to a «Financial Times» report.
