Leopard Cambodia Fund – Monthly Newsletter Issue 18 – October 2009


Reminder – Leopard Sri Lanka Investment Forum


Don’t forget to register for our Leopard Sri Lanka Investment Forum 2009, which will be held at the Cinnamon Lakeside Hotel in Colombo on November 20-21st. Click here for the Agenda and Registration form. Attendees will learn in detail why we believe that, alongside Cambodia, Sri Lanka has become Asia’s best place to invest now. We will also present additional details about our upcoming Leopard Sri Lanka Fund (private equity) and Leopard Sri Lanka Value Fund (public equity).



Leopard Cambodia Fund News


LCF’s fund size continues to creep upward and reached $28,755,000 on 30th September 2009; our thanks go out to our newest investors. There are now just nine weeks left of our fundraising period, with the final monthly closings on 30th October, 30th November and 31st December 2009. We are seeing a welcome surge of investors planning trips to Phnom Penh during this final stretch, and strongly encourage anyone else who is still unconvinced to come check things out first-hand. Cambodia always exceeds visitors’ expectations. For fund subscription information, qualified investors please email Thomas: [email protected].



Portfolio Notes 

Kingdom Breweries (“KB”) held its first Board meeting and established an Executive Committee, with two Leopard Managing Partners members at each level. KB has appointed Bates 141 to develop its branding and marketing, and Archetype to design the factory renovation. The factory building has been surveyed and a maintenance crew is working daily to clean it up, which is a big job. KB has selected and ordered its brewery equipment from Europe, and is in discussions with two very experienced European brew masters. The project remains on schedule and within budget.

The Investment Team has recently proposed term sheets to four more potential investee companies. Hopefully some will accept in time to be mentioned in the November or December newsletters. Behind those four are a bunch more deals approaching maturity and it may not be all that long before Leopard Cambodia Fund is fully invested.


New Staff

We say farewell to our former Associate Tony Sunly, and welcome our newest research intern Richard Woodhull. Richard worked in UNDP Cambodia’s “Growing Sustainable Business” program helping attract foreign investment, and with PricewaterhouseCoopers in London and Chicago, and the World Bank in Washington, DC. He holds an MA Honors degree from Scotland’s University of St. Andrews.



In The News

  • Cambodia’s GDP growth will recover to 3.5%-4.25% in 2010, following 2009 negative growth of 2.75-3.5%, according to IMF and ADB’s latest forecasts. Clearly they expect the worst is behind us.
  • China has pledged over $500 million in loans next year to finance roads, dams and bridges, ports, irrigation, and rural electrification projects in Cambodia, on top of $260 million last year. Meanwhile visiting Korean President Lee-Myung Hak topped up Korea’s loan agreement to Cambodia from $120 million to $200 million through 2012.
  • Hyundai plans to open in February Cambodia’s first auto assembly plant, in the Koh Kong Special Economic Zone near the Thailand border. Initial capacity will be 3,000 cars per year.
  • Preah Sihanoukville International Airport will be inaugurated in November by Prime Minister Hun Sen and French Prime Minister Nicholas Sarkozy.


Conference Schedule 

T&I Southeast Asia Conference

Marriott Courtyard, Bangkok, November 3-4. Email Jerry Borrell for details, [email protected]. 

T&I Fifth Annual Vietnam Conference

Park Hyatt Hotel, Ho Chi Minh City, November 16-17. Email Jerry Borrell for details; [email protected]. 

Leopard Sri Lanka Investment Forum 2009

Cinnamon Lakeside Hotel, Colombo, November 20-21. Click here for the program agenda, or email Vidhumin Grero, [email protected] to register to register.  

Tonkin Corporation’s Capital Raising Asia 2009

M Hotel, Singapore, November 23-25. Click here for the program agenda, or email [email protected] to register.



Visit Notes: Kompong Thom, By Douglas Clayton  

It’s a public holiday and I’m making a day trip to rural Kampong Thom (“KT”) province with some Cambodian friends. It seems all of Phnom Penh is heading to the countryside for the Hungry Ghost Festival, and our driver suggests taking a different route which turns out to be equally jammed. Along the way we pass two long-span bridges being built across the Tonle Sap River; further signs of the game-changing transformation of Cambodia’s infrastructure. But for now our route involves an old-fashioned ferry crossing, preceded by an hour’s wait behind a swarm of bulky Lexus SUVs, the national car of the Cambodian elite.

KT sits 160 kilometers northwest of Phnom Penh, on the way to Angkor Wat. In Cambodia terms it’s a large but lightly populated province, with a half million farmers scattered across 13,000 square kilometers. KT borders the north side of the great Tonle Sap Lake which floods into the province every year, creating some of the nation’s richest topsoil. Much of the countryside we pass is submerged now.

KT’s center offers a couple 2 star hotels and the obligatory fresh market and riverfront, but it lacks the curb appeal and vibrancy of the big farm centers like Battambang or Kampong Cham. There must have been a few administrators based here during the French period, as I spot a couple fading colonial buildings looking a bit out of place in the town’s dusty outskirts. But the province’s historical importance peaked way back in the Seventh Century when it was the capital of the forgotten Chenla Kingdom, which gained power three centuries before the Angkorian era. Should you find Angkor Wat too discovered, there are over 100 rarely visited Chenla ruins to explore in KT; these must have been admired by the master builders of Angkor Wat who further perfected their style.


These days KT is targeted not for tourism but for agriculture-related investment. Last year the government of Kuwait offered a $486 million soft loan to fund a dam on KT’s Steung Sen River; this megaproject is supposed to create 40 MW of hydropower and irrigate 130,000 hectares of rice land. Little has been heard since the first announcement, and I see no signs that the project has commenced yet. But ever since rice prices spiked in 2007, wealthy Middle East rulers have hungered for food security, and want to turn KT into a massive rice farm.

Our Leopard Cambodia Fund is also interested in KT, which is the home of our Cambodia Plantations project’s field manager, Vanna. Vanna is a former physician who gave up medicine for his first love, farming. His family farm provides an interesting visit as it includes high-yielding rice fields, fish ponds, a turkey flock, and coolest of all, a crocodile farm. The scaly creatures bask in the sun with their toothy mouths agape, grouped by size into crowded pens with towering concrete walls. As we cross the pens on a catwalk, the unholy green water down below looks more frightening than the torpid reptiles. After a fulfilling life of lying around waiting for feeding time, the adult crocs are sold live to Vietnamese traders who wrap duct tape around their mouths and truck them across the border for “processing”. Apparently the live croc market crashed last year but bounced a bit recently, although these gyrations may well have gone unnoticed by most commodities traders.

After driving past some of KT’s vast, wet rice paddies we turn off the paved 2-lane highway to a side road leading to a Wildlife Preserve. This laterite road is unexpectedly wide and smooth, and devoid of traffic except for some plodding wooden oxcarts laden with poles. My friend’s youthful driver sees the open road as a rare chance to test how fast the boss’s SUV can go, and he pushes the pedal down, oblivious to the small herds of floppy-eared white cattle ambling across the road. It seems only a matter of time before the recklessness of youth encounters the realities of nature, and sure enough we suddenly hear a soft thump when a slow moving cow fails to dodge our fast moving surrogate race car. Fortunately the sturdy creature walks away from the incident unwounded – unlike our driver’s pride – and our journey now resumes at a more appropriate speed.

Passing the rural dwellings along the roadside I observe how housing publicly displays a family’s private success. The poorest families make do in crude shelters constructed entirely of woven thatch; the walls have an open door passage but no window openings. In the next social tier, the homes have wooden walls and thatch roofs, and are elevated on wooden poles, safely above the livestock and any floods. The better established families live in homes with doors that close, open window frames, a durable roof of tin or tile, and concrete stilts. The village’s wealthiest families showcase their status by adding luxurious ornamentation to their homes: carved patterned trim work along the eaves, and painted exterior walls (light blue is popular.) But affluence is always relative; even the best homes here lack glass windows, electricity, or indoor plumbing; in fact most homes do not appear to even have outdoor bathrooms.

The locals seem to have settled here in the past few years, perhaps with some government or NGO assistance as I notice a few sturdy cement wells. Some families have cleared the woods behind their homes and created subsistence-sized rice fields. While waiting for the rice to grow, most families raise cattle and cut forest wood for lumber or charcoal. Underneath most elevated houses there’s a stack of rough cut boards; a basic form of savings that can be traded in a family emergency.

Cambodia is a country of kids and there are plenty of kids here. All are sun-bronzed and rail thin; malnourishment is rural Cambodia’s dietary challenge, not obesity like in rural America. I see no schools, toys or bicycles here; just lots of kids working, either herding their wandering cattle or hauling in wood. The only happy smiles I see are on a few toddlers splashing in a flood-puddle while their older siblings trudge home from the forest (see photo). They stare at our fancy SUV like an alien spaceship has landed.

We drive up to the unguarded Wildlife Preserve, and soon confirm my suspicion that this is the source of the firewood that the kids are hauling home. Swathes of forest have already been stripped bare and the remainder seems just waiting for the saws and machetes. Driving the demand is Cambodia’s booming charcoal industry, reportedly a $25 million business in Phnom Penh alone, despite being considered a leading cause of global warming. The vision of unschooled children sent to chop down a protected forest to produce a destructive fuel is troubling, but prevalent across Cambodia and the developing world. Perhaps the villagers understand that the quicker they can degrade this Preserve, the sooner it might be converted into a big rubber or cashew plantation which might offer them employment and even build a community school. More likely they are just trying to survive another day by making use of the resources available to them, as pioneer settlers have always done on the frontiers of human history.



Picture of the Month: Kids at Work and Play, Kampong Thom Province. Photo by Douglas Clayton






This document does not constitute an offer to sell, or a solicitation of an offer to invest in Leopard Cambodia Fund LP and/ or Leopard Cambodia Investments (BVI) Ltd. (collectively, “our Funds”) We will not make such offer or solicitation prior to the delivery of a definitive offering memorandum and other materials relating to the matters herein. Before making an investment decision with respect to our Funds, we advise potential investors to read carefully the respective offering memorandum, the limited partnership agreement or operating agreement, and the related subscription documents, and to consult with their tax, legal, and financial advisors. We have compiled this information from sources we believe to be reliable, but we cannot guarantee its correctness. We present our opinions without warranty. Past performance is no guarantee of future results. © 2009 Leopard Capital LP. All rights reserved.

In this Issue 

Leopard Sri Lanka Investment Forum

Leopard Cambodia

Portfolio Notes


In The News

Conference Schedule

Visit Notes: Kompong Thom

Picture of the Month



Quick Links 


Leopard in the News: Media articles about Leopard Cambodia Fund and Cambodia are posted on our website; click here.


The NAV of Leopard Cambodia Investments (BVI) Ltd. was as of 30th September 2009 US$ 1’013.34 (30th August 2009 US$ 1’012.76)

Investing in LCF via a Self Invested Personal Pension Plan (SIPP):

UK taxpayers can invest in LCF via a SIPP and enjoy certain tax advantages.

Hornbuckle Mitchell is our SIPP provider:


Contact their Asia SIPP expert

Stephen Davis at:
[email protected]


Leopard Cambodia Fund, LP

Fund size:

USD 28,755,000 








Valoren No:






Lipper ID:



Leopard Cambodia Investments (BVI) Ltd. 


Fund size:

USD 18,480,000








Valoren No:






Lipper ID: