Guidelines for investments

IFU & IØ's operational guidelines

1.  COUNTRY LIMITATIONS
Technically eligible host countries of IFU investments must be on the OECD’s DAC list of development aid recipients, and 2008 GNI per capita income may not exceed USD 3,084 (limit in 2010). A general exception for the limit is given for Botswana, Namibia and South Africa.

Azerbaijan, El Salvador, Angola, Armenia, Jordan and Cape Verde now have a GNI per capita income above the limit, but are still eligible for IFU investments in 2010. A complete list of countries IFU can operate in, can be seen here.

IFU’s country exposure is constantly gauged, and a warning signal is flagged when IFU’s project portfolio in a given country exceeds 30% of IFU’s total project portfolio. For China the country exposure must not exceed 20%.

IØ can only make new investments in Russia, Ukraine and Belarus, while all other former IØ countries with a GNI per capita income below the above mentioned limit are eligible for IFU investments.

2.  PARTNER LIMIT
The indicative partner limit is 20% of the Funds’ total project portfolio.

3.  PROJECT LIMIT - ABSOLUTE
The indicative limit for the Funds’ maximum investment in a single project is DKK 100m for IFU and DKK 50m for IØ.

4.  PROJECT LIMIT - RELATIVE
The Funds’ indicative general limit of engagement (loans and share capital) in a single project is 50% of the balance in projects with a total investment of up to DKK 7.5m, and gradually decreasing to 30% in projects with a balance of more than DKK 12.5m. For projects in Low Income Countries (LICs), the indicative limit for IFU is 49% of the balance.

5.  PROJECT EQUITY LIMIT
The Funds’ equity exposure in any project must not exceed neither that of the Danish partner nor 49% of the total project equity.

Last updated 5 January 2010.