The International Finance Corporation, an arm of the World Bank, will put US$10 million into a Sri Lanka-focused private equity fund.
The US$50 million Emerald Sri Lanka Fund I will be run by NDB Zephyr Partners, a joint venture between New York-based Zephyr Management and Colombo based-NDB Bank group.
The fund will target mall and mid-sized businesses seeking growth.
"The Fund will take significant minority stakes in 10-12 well run companies," said the IFC said in a statement. "The Fund will add value by providing support and expertise on capital structures, financial reporting, business development, management development, corporate governance, strategy etc. to the portfolio companies."