ACE half-way to €300m target

The French firm launched its third aerospace-focused vehicle in late January in a bid to support the country’s high-tech SMEs and prepare the sector for further internationalisation.

ACE Management, a high-tech focused French private equity firm, has held a first closing on its latest fund on €150 million. 

The firm wants the fund, which was launched 25 January, to be the largest dedicated to the aerospace industry. It has a target of €300 million, and counts CDC Entreprises, the SME investor owned by French bank Caisse des Dépôts, as well as aerospace heavyweights Airbus, Safran, EADS and Eurocopter as its first-round LPs. 

Aerofund III also enjoys strong backing from France’s political leaders: present at the fund’s launch were Arnaud Montebourg, French minister in charge of productive recovery, and Frédéric Cuvillier, French minister in charge of transport. CDC’s participation in the project is part of FSI France Investment, a programme set up by the government to finance SME’s growth via equity investment.  

Aerofunds support 
SMEs in the aerospace

The fund’s strategy will remain broadly similar to that of its predecessors. Since 2004, ACE’s Aerofunds have focused on investments in the aerospace SME market, providing growth capital and fostering consolidation among key suppliers to the industry. Their support has typically gone to companies with less than €500 million in annual revenues. 

But ACE’s third vehicle also will benefit from a slightly broader mandate. Aerofund III will be able to invest up to 20 percent of its resources in foreign companies, as well as allocate funds to companies in turnaround situations, the firm said in a statement. 

The vehicle’s target is more than triple that of Aerofund I and II, which respectively reached their final close on €91 million and €90 million. 

“With Aerofund III, we benefit from increased resources to play a greater role in the French aeronautical SMEs development. Indeed, it is of strategic importance to give an efficient support to the consolidation of this sector, which is expected to be more and more international and to contribute actively to our country’s growth,” Thierry Letailleur, chairman of ACE Management, said in a statement. 

ACE’s funds have played a significant role in supporting the sector’s smaller players over the last eight years. The firm has made 20 investments in the aerospace industry since 2004, in companies worth a total €1.6 billion in annual revenue and employing 15,000 staff. 

Its total assets under management amount to €450 million, invested via nine different funds. Backed by a number of European industrial groups, institutional investors and four French regions, these vehicles primarily invest in the aerospace, maritime, defence and security sectors.