A U.S. government financing agency says it plans to pump $150 million into a Mideast private equity fund designed to promote the growth of small and medium-sized businesses in the region.

A division of Dubai-based Abraaj Capital, the Middle East's largest private equity firm, will manage the financing provided by the U.S. government's Overseas Private Investment Corporation.

OPIC and Abraaj said in a statement late Sunday that the Abraaj-managed Riyada Enterprise Development Growth Capital Fund aims to help businesses across the Middle East and North Africa, with Egypt as one of the main targets. It is expected to ultimately have a capitalization of $400 million.

OPIC uses private capital to promote development and helps businesses break into emerging markets.