Galena Asset Management has reached final close on its $400 million Private Equity Resources Fund, according to a statement. The fund, which is wholly-owned by global commodity trader, Trafigura, will invest in both equity and debt of small- and medium-sized metals and mining companies, continued the statement.
The fund will focus on miners in a development or expansion phase and will leverage Trafigura’s mining expertise and relationships. Smaller miners have struggled to attract financing over the last few years as metals prices have fallen and banks have been reluctant to extend credit for refinancing or raising capital expenditure for development.
Private Equity Resources Fund made its first investment last June when it formed a joint venture with Bowie Resources to buy-out Canyon Fuel, a coal mine. The venture formed the largest thermal coal producer in the Western Bituminous region of the United States.
“Galena’s decision to use Trafigura’s experience and launch a dedicated private equity activity came naturally as institutional investors have increasingly asked us to co-invest with the Group,” said Duncan Letchford, chief executive of Galena.
The fund will invest in geographically diverse assets, coal mining as well as base, ferrous and precious metals.
Galena Asset Management was formed in 2003 initially providing investment management services to commodity-related funds before launching investment management activities a year later.