ACG Private Equity targets €300m for Fund V

The mid-market European fund of funds will invest the vehicle in Central and Eastern Europe, special situations and growth capital funds.

ACG Private Equity, formerly known as Altium Capital Gestion, has begun marketing for its fifth European fund of funds.

The Paris-headquartered firm aims to raise between €250 million and €300 million for ACG Europe V, one-third of which will be allocated toward special situations funds. The balance of the fund's capital will be divided between Central and Eastern European and growth capital funds.

London-based Trinity Group is placing the fund in the UK and Northern Europe, while BRN is marketing the fund to US investors, managing director Lorenzo Lorenzotti said during an interview in London. The fund of funds has also enlisted some private individuals to approach Middle Eastern limited partners.

While acknowledging today’s tough fundraising climate, Lorenzotti said ACG Private Equity is well placed to capitalise on fallout from investment banks’ mergers, failures or disappearances, which have in turn put their private equity groups in limbo. LPs now have a rising interest in independent firms where partners are heavily invested in their funds and can demonstrate their franchises will exist far into the future, he said.

ACG Private Equity also believes the fund’s three-pronged investment strategy is “defensive” in current market conditions. Eastern Europe continues to have attractive growth prospects, while the financial crisis will create more special situations opportunities and small- and mid-market funds will be less affected by financial turmoil than large-cap funds, Lorenzotti said.

In addition to ACG Europe V, the firm last year began marketing a mezzanine fund of funds with a €100 million target.

The 11-year-old mid-market investor was founded in 1998 by ex-partners of Apax Partners Finance, Apax France’s former M&A division. Apax Partners Finance became Altium Group in 2001 when Apax France decided to focus solely on private equity and sold the M&A division.