B&S Private Equity Group, the Italian mid-market private equity firm, has surpassed its E500m target for its fourth fund within seven months of launching the fund.
Italian Private Equity Fund IV (IPEF IV) held a first close of the fund on E400m and has raised a further E100m since then. The fund’s largest investor is HarbourVest Partners, with additional commitments coming from existing investors Adams Street Partners, Liberty Mutual, and AXA and new investors including Danske Private Equity, NIB Capital Private Equity, and the California State Teachers’ Retirement System (CalSTRS).
B&S partner Francesco Sironi said the firm would continue its previous strategy of investing in mid-market industrial opportunities in Italy in the E30m to E100m value range. IPEF IV will not make investments until the summer, by which time IPEF III is likely to be 85 per cent invested.
“There has been a marked improvement in the Italian market during the last twelve months. Private equity is establishing itself as a real alternative in Italy. When someone is looking to sell a business, the first people they speak to are the private equity firms,” said Sironi.
The success of fund IV comes despite the firm having made only one realisation on the 20 investments so far made from the third fund. 30 per cent of Fund III was invested in 2002 in five new transactions and nine add-on deals. The one realisation so far achieved an IRR of 43 per cent. However, ten per cent of the fund, which was launched in December 1999 was designated to early-stage investments, and has been less successful.
Sironi said the latest fund will be capped at E550m and will close within the next two months. B&S is being advised by International Private Equity Services (placement agent) and SJ Berwin (legal).