IFC – International Finance Corporation invested €25 million in the first close of Mediterra Capital Partners III, a private equity fund managed by Mediterra Capital Management Limited, to increase access to funding for local companies, strengthen the competitiveness of Türkiye’s private equity ecosystem, and enhance gender diversity in the country’s private equity market.
With a target size of €165 million, the fund aims to invest in lower mid-market companies in Türkiye, focusing on either companies that cater to domestic consumption, have an export orientation, or offer technology-enabled services. IFC’s investment will be critical and catalytic for the fund to reach its target size.
Türkiye’s private equity market has experienced challenges in recent years due to macroeconomic volatility and changing investor dynamics. The market, which once attracted significant international investor interest, has faced a decline in investor demand. This has resulted in a smaller number of active private equity funds compared to previous years. This situation has created a shortage of patient risk capital for companies, hindering their growth potential, income generation, and ability to provide employment opportunities.
“Mediterra is grateful to IFC, the European Bank for Reconstruction and Development (EBRD), Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO – Dutch entrepreneurial development bank) and the Technology Development Foundation of Turkey (TTGV) as the cornerstone investors for Fund III who have been consistently supporting Mediterra as value-added investors in our predecessor funds over the last decade,” said Murat Erkurt, Co-Founder of Mediterra Capital Management.
The project aligns with IFC’s strategic objectives, including boosting competitiveness and enabling services, as well as improving jobs for women, youth, and vulnerable groups. Additionally, IFC will support the fund in improving gender diversity within its investment team and portfolio companies.
“By supporting Mediterra Capital Partners III, IFC is helping address the shortage of much-needed capital in Türkiye’s private equity market, supporting the country’s startup ecosystem and helping stimulate economic growth,” said Wiebke Schloemer, IFC Director for Türkiye and Central Asia. ” The fund will bring essential growth capital to lower mid-market companies, helping them create jobs, reach new markets, and provide goods and services across a number of sectors.”
