Cinven hits €10bn hard-cap on Fund VII

The European private equity stalwart's latest fund is the second-biggest capital raise this year.

Cinven, one of Europe’s biggest private equity houses, has held the final close on its seventh fund after less than four months in market.

The London-headquartered firm raised €10 billion for the Seventh Cinven Fund and hit its hard-cap, according to a statement. More than 180 investors across over 30 countries committed to the fund which closed oversubscribed.

It is understood the fund’s target was €8 billion.

“We have raised a Fund that is right-sized for the market opportunity, and, through Cinven’s Sector and Regional teams, we continue to identify attractive investment opportunities that we can target to define angles and strategies to step-change growth,” said managing partner Stuart McAlpine.

The fund had a high re-up rate and included new investors, according to the statement.

Fund VII is the second-largest capital raise this year, behind Thoma Bravo’s $12.6 billion haul for its 13th fund and ahead of EQT’s €9 billion for EQT Infrastructure Fund IV during the first quarter, according to PEI data.

Tennessee Consolidated Retirement System and Taiwan Life Insurance are limited partners in Fund VII, according to PEI data. Tennessee, which committed €150 million, was also an investor in the firm’s predecessor, the 2016-vintage Sixth Cinven Fund, which closed above its €5.5 billion target on €7 billion.

Fund VI has invested in 15 companies so far and its unrealised portfolio generated double-digit EBITDA growth last year, according to the statement.

The firm’s 2012-vintage €5.3 billion Fifth Cinven Fund has delivered a 3.2x money multiple across nine fully exited investments. It is unclear whether this figure is gross or net.

The momentum that has driven rampant private equity fundraising has continued into 2019. In the first three months of this year, $91 billion of capital was raised in final or interim closes, which puts it on a level with 2018.

Other big beasts in the market include Blackstone, Advent International, Warburg Pincus and Apax Partners, all seeking more than $10 billion for their flagship fund series, according to PEI‘s QI fundraising report.

Regardless of concerns about where we are in the market cycle, numerous surveys suggest the secular growth in demand for private equity exposure will continue. More than one-third (36 percent) of insurers expect to increase their allocation to private equity over the next 12 months, more than any other asset class, according to Goldman Sachs Asset Management’s Insurance Survey 2019. The results mark a 32 percent net rise from last year.