Axa Private Equity has bucked the recent trend of private equity firms quitting Germany by announcing plans to expand its German office to incorporate direct investment activities. The firm is looking to allocate around E100m of its AXA Private Equity II fund for such German investments.
Stefan Illenberger, who heads the firm’s German operations, said the firm will look to make two investments this year, with one expected within the next four weeks. The firm is also planning to make investments in both venture capital and growth and expansion capital funds.
“We intend to develop our business in Germany where we already have over E630m of global commitments in 43 funds,” said Illenberger, who also oversees the firm’s secondary and primary fund of funds operations in Germany. “The German office also advises the New York and London team in managing E340m of investments in global funds invested from German and Austrian institutions.”
Illenberger leads a team of eight, including Helmut Pitsch, previously a managing partner of Centennium Capital Partners, who will be responsible for the firm’s direct investments.
Axa Private Equity Germany will use its existing links with the Harald Quandt family to increase its dealflow in Germany, primarily via co-investments. “Because we are only investing a relatively small amount when compared with other international investors, we are able to be more selective over the deals we pursue”
Illenberger added that he was not perturbed by the recent departures from the German market, including Clayton Dubilier & Rice’s decision not to proceed with its plans for an office in Europe’s largest economy. “In many ways, the recent departures suit us as it gives us a stronger position in the market. The situation in Germany has been exaggerated to a certain extent. Dealflow is good, although maybe not as good as elsewhere. We’re quite happy to be considered anticyclical.”