Brian O'Connor has teamed up with Glenn Yusuf and Samir Soota to form Falcon House Partners, which is based in Jakarta.
The firm is launching a new Indonesia-focused private equity fund named Falcon House Partners Indonesia Fund 1. A leading global private equity fund investor based in Hong Kong said that the fund was "one of the most eagerly awaited private equity launches of the year".
The fund's target size is $200 million with a first projected close in 2012, and it will concentrate on acquiring minority stakes in growth capital and business revitalisation deals for Indonesian mid-market and small-size companies.
The fund is focused on using its relationships to find companies where they can add significant value, particularly in the consumer and natural resources sectors. However, they are not keen on oil and gas and pure real estate plays at present.
The fund has a 10-year life and is looking for deals that can produce an internal rate of return of 25% minimum per year. It expects to accommodate six to eight deals within the first fund.
The men met 16 years ago when O'Connor, who was then Lehman's first banker posted in Jakarta, advised Yusuf, who was then CEO of PT Danareksa, on privatisations. They teamed up again in IBRA, which was instrumental in cleaning up Indonesia's corporate headaches after the Asian financial crises.
Yusuf was the first chairman and Lehman was adviser. Yusuf later became an independent investor working alongside Ashmore, while O'Connor had a spell at Nomura.
It has long been speculated that he would return to Indonesia in a private equity venture. He spent much of the 1990s there before becoming Lehman's head of non-Japan investment banking and then Asia-Pacific chief operating officer.
Soota was hired by Yusuf into Danareksa where he was responsible for its direct investments. Subsequently, Soota was CEO of KPMG's mid-market advisory and investment business, founder of the investment arm of an Indonesian PE firm and then head of EMP-Daiwa's PE fund in SE Asia.