Jul. 11–Vnet Capital, a venture capital firm run by information technology veteran Narong Intanate, has diversified into the automotive sector with a venture capital fund for small businesses in theauto industry.

The fund is offered through the newly established Thai Automotive VCF (TVCF), which has paid-up capital of 260 million baht held by four shareholders: JAIC Asia Capital (JAIC), Vnet Capital, SME Bank and Sumitomo Corp.

Mr Narong said the fund was the first one specifically for the automotive industry in Thailand.

“Thailand will be the Asian hub of the automotive industry as currently we sell 400,000 cars per year, with [another] 200,000 units for export,” he said.

Major automotive manufacturers such as Ford, Mitsubishi, Honda and Toyota are also planning to expand their manufacturing bases and research and development in Thailand.

Mr Narong noted that through the fund, SMEs will have access to technology advice from professional consultants.

In Thailand, there are around 3,000 automotive SMEs, he said, adding TVCF would invest in eight to 12 companies during the eight-year term of the fund.

Mr Narong said the investment criteria included companies with up to 200 million baht in fixed assets and fewer than 200 staff. The investment amount is 20-40 million baht, or not more than 15 percent of TVCF’s capital, with no investment for the purpose of exercising control or holding a majority shareholding.

“We do not invest in start-up companies. Only those with a track record of at least three to five years or those preparing for expansion or listing,” he said.

If TVCF is successful, the firm will set up similar funds for the food and software industries.

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