CORRECTED - CORRECTED-Yorkville opens Asia-Pacific hub, eyes SME investments

(Corrects to show Yorkville does not have offices in Singapore and Australia. Clarifies the Hong Kong office originally opened in September)

HONG KONG, April 22 - U.S. investment firm Yorkville Advisors opened an Asia-Pacific hub office in Hong Kong on Wednesday, aiming to capitalise on cash shortages among small businesses struck by the financial crisis.

Small and medium-sized enterprises (SME) have been one of the biggest casualties of the collapse in exports in Asia. They have had trouble raising capital as many banks wean risk from their loan books and borrowing costs remain high.

The New Jersey-based firm, which calls itself an investment bank wrapped in a hedge fund, has about $1 billion in assets under management.

It sets up structured investments with mostly publicly traded companies in need of relatively quick cash. However, it neither short sells assets nor does it take controlling positions in companies, unlike hedge funds and private equity firms.

"The SMEs have still got a lot of issues trying to raise local capital especially from local banks. The large caps are succeeding like in Korea and Japan still have access to local bond markets or commercial banks, but I don't think the SMEs are getting that," said Anthony Chan, the firm's managing director and head of Asia.

Investment firms ranging from distressed debt funds to non-performing asset specialists have been flocking to Asia where they smell opportunities, with nearly $500 billion in debt maturing this year and banks still reluctant to lend.

Yorkville initially opened an office in Hong Kong in September 2008 and has been adding staff with expertise in Japan, South Korea and other Asian markets since then.

Yorkville has done 30 transactions in Australia and Singapore, including providing some $58 million in credit facilities to Queensland Gas Co Ltd in return for equity, and plans to open an office in Japan later this year.