Bregal commits €1bn to rebranded Englefield

Bregal Investments, the investment arm of the Brenninkmeijer family, has made a €1 billion commitment to Bregal Capital, its direct European private equity platform formerly known as Englefield Capital.

The commitment has been unveiled by PEO following media reports that Dominic Shorthouse, one of Englefield’s three founding partners, will break away from his colleagues Adam Barron and Edmund Lazarus as Bregal takes control. Shorthouse will raise a separate fund under the Englefield Capital brand.

“The family decided that they wanted to have control. They like the asset class, they like what we built and it’s only natural evolution that they decided they want to own all of it,” Shorthouse told PEO. “It is something that I always had in mind that might happen, but it was probably a little earlier than I expected,” he said, adding that the split was “absolutely not” acrimonious.

Adam Barron and I wish Dominic every success in his future endeavours and would like to express our appreciation for his enormous contribution to the creation and operation of the firm. Edmund Lazarus

Bregal has agreed to be a “material” LP in the new Englefield-branded fund, but not on the same scale as its previous commitments to Englefield, said Shorthouse, who left Warburg Pincus in 2002 to launch Englefield.

Bregal, which is by far the largest limited partner in Englefield’s first two funds, comprising around 90 percent of its historical funding base, will rebrand the remaining entity as Bregal Capital. The firm will be led by Barron, formerly of Warburg Pincus and Goldman Sachs, and Lazarus, formerly of Morgan Stanley Capital Partners. The pair were previously Englefield's European joint-heads.

Englefield’s second fund – a €1.06 billion vehicle closed in 2007 – is approximately 50 percent invested. The remainder of this fund, and its €1 billion successor, will be managed by the team led by Barron and Lazarus.

They like the asset class, they like what we built and it’s only natural evolution that they decided they want to own all of it. Dominic Shorthouse

While Shorthouse has been bought out of the original management company, Lazarus and Barron have not crystallised nor sold their interests in the company, according to Lazarus.

A number of the smaller limited partners in Englefield’s existing funds have meanwhile received an offer from Bregal to buy their stakes. This is because they are personal contacts of Shorthouse and may want the option of leaving along with him, said Shorthouse, who has decided to retain his limited partner interests in the historic funds. Shorthouse will be advised on raising his new fund by former Jeffries Helix managing director Clive Norton.

“Adam Barron and I wish Dominic every success in his future endeavours and would like to express our appreciation for his enormous contribution to the creation and operation of the firm since its inception,” Lazarus told PEO.

He added that he and Barrow were delighted to be assuming the leadership of the firm and “even more deilghted” that Bregal had expressed confidence in the team’s investment track record with the further commitment of €1 billion “for investment in the coming years”.

Bregal's direct private equity affiliates, in which it is the predominant LP, include US mid-market buyout group Centre Partners and US special situations firm Ranch Partners.