MDV keen to go into convertibles
0 Comments | New Straits Times, Jul 28, 2010 | by Jeeva Arulampalam
MALAYSIA Debt Ventures Bhd (MDV), a wholly-owned unit of the Ministry of Finance (MOF), wants to introduce convertible debts as it seeks to provide funding for the production stage of a new company’s life cycle, which involves higher risks.
MDV, an innovative financier and development facilitator for information and communications technology and biotechnology companies, currently provides debt financing only.
“We are keen to go into convertibles as it will place us in a more favourable position to take up higher risks instead of just basing on companies or projects that have an uptake or a secure market,” MDV chief executive officer and managing director Zubir Ansori Yahaya told reporters after its fifth Business and Technology Speakers’ Series held in Kuala Lumpur yesterday.
Zubir said there was still a huge gap between venture capital and venture debt in the country.
Venture capital is seed funding, or early-stage funding, given to high-growth companies. Venture debt is funding for companies that need working capital, typically for production purposes.
“These companies have a secure market for their products but not a firm uptake. And, in order to sell the products, they need plants for the production process. Banks are not keen to lend at this stage
business finance
