Chequers hits €850m hard-cap

The Parisian firm exceeded its €800m target after only three months of fundraising.

Chequers Capital closed its 16th fund focusing on the French mid-market at its €850 million hard-cap after about three months of fundraising 31 May, sources told Private Equity International.

Commitments for Fund XVI have come from a combination of new investors and re-ups from existing investors, according to a person with knowledge of the fundraising. Fund XVI is the largest in Chequers’ history as an independent firm..

Chequers exceeded fundraising targets in both of its previous funds. The Chequers Capital Fund far surpassed its €200 million target when it closed on €300 million in 2002. In 2006, the firm closed its 15th fund at its hard-cap of €600 million, ahead of its initial target.

Fund XVI is actually Chequers’ third as an independent firm. Chequers spun out of Charterhouse France in 2001 after HSBC divested Charterhouse Development. Charterhouse France formed in 1972 as a subsidiary of Charterhouse Development Capital. Credit Commercial de France acquired Charterhouse Development in 1998, which in turn was acquired by HSBC in 2000.

Chequers’ funds have primarily focused on controlled buyouts of mid-market French companies with enterprise values between €30 million and €500 million. The firm targets a 20 percent or greater internal rate of return and a 2.5x multiple of invested capital over a four to five year period, according to documents from the Massachusetts Pension Reserves Investment Management Board. The pension system committed up to €40 million to the fund this week.

Chequers made a GP contribution of between 1.2 and 2.75 percent of commitments with co-investment arrangements for the fund, according to pension documents.

The closing of Chequers Capital XVI comes on the heels of several other successful fundraising efforts in France, where some market sources say domestic LPs are becoming wary of private equity.

As French LPs have backed away from private equity, international investors have moved in. 21 Partners recently closed on €380 million for its fourth French fund with three-quarters of the capital coming from non-French investors. The Paris-based Astorg Partners also reached its hard-cap at more than €1 billion on its fifth fund in April with only 11 percent of its LPs coming from France.