The European Investment Bank (EIB), the long-term financing arm of the European Union (EU), is participating to the tune of EUR 20 million (1) in the international closed-end fund Tlcom I LP targeting expanding investee companies in the high-tech telecoms and internet sectors. This is the EIB's seventh venture capital operation mounted in Italy over the past three years, bringing the Bank's aggregate commitment in this area to more than EUR 200 million.

Tlcom I LP is the brainchild of a group of executives with significant experience in the telecoms and internet sectors, who have entered into a strategic cooperation agreement with Morgan Stanley Dean Witter Inc. (MSDW), one of the leading US investment banks, for the purpose of establishing a dedicated venture capital fund with the focus on investing in these areas. It follows that the fund will also be attracting capital from outside the European Union for inwards advanced-technology investment.

The target volume of the fund, scheduled to have a life of some six years, possibly subsequently extended to nine years in all, has been set at EUR 150 million, two thirds of which have already been committed by a group of Italian banks, industrialists and domestic retail investors. The minimum commitment is EUR 20 million for institutional and corporate investors and EUR 5 million for private investors.

This operation is one of the first to be concluded by the EIB under its Innovation 2000 Initiative (i2i) unveiled in June of this year and designed to foster investment in the human capital, information society, R&D, innovation and competitive leading-edge technology sectors. Venture capital is viewed as a key vehicle spearheading the i2i strategy inasmuch as it provides emerging high-growth smaller businesses with the investment funds vital for their development and, at the same time, raises their job creation potential.

Founded in 1958 with the prime mission of financing capital projects designed to promote a closer-knit Europe, particularly by furthering regional development, the EIB has since seen its remits steadily widened from its original goals of fostering regional-development-associated industrial competitiveness and integration, with the emphasis on smaller businesses (SMEs), to encompass consolidating secure energy supplies, safeguarding the environment and advancing implementation of essential trans-European transport, telecommunications and energy networks. Outside the EU, the EIB supports the Union's cooperation and development aid policies in favour of a large number of partner countries. The Bank's shareholders are the Member States. The EIB raises its resources on the capital markets, where it commands the finest terms by virtue of its "AAA" rating.

(1) EUR 1 = ITL 1936.27