Cognetas continues to undergo significant change: the firm revealed today it has closed its Frankfurt office and will wind down its UK operations. It will now concentrate on France and Italy, where the bulk of its €1.25 billion Fund II’s remaining portfolio companies are located.
“Cognetas now intends to focus on the portfolio and return to the market to raise a new fund in due course,” the firm said in a statement, which noted Fund II had €200 million left to invest in its seven portfolio companies.
In line with the changes, Jonathan Musselwhite and Charles St. John, both of whom were involved in the Cognetas spin-off from Electra Investment Trust in 2005, will leave the firm.
The departures of Musselwhite and St. John follow that of managing partner Nigel McConnell in June. McConnell left over “strategic differences” which were not publicly explained and the firm’s Paris co-head, Patrick Eisenchteter, took over as managing partner. Fund II’s investment period closed a month early due to a key-man provision related to McConnell’s departure.
The fund’s existing portfolio, which includes assets like Italian pet store chain Arcaplanet and food ingredients firm Diana Ingredients in France, is reportedly of interest en masse to an unnamed investor. The Financial Times reported Wednesday that an unnamed investor has sent a letter proposing to buy Cognetas’ portfolio companies, offering existing investors the chance to reinvest if acquired.
A source close to the firm has revealed that a sales process has been started for one of its companies, French fuel dispenser manufacturer Tokheim. It's thought the asset might fetch as much as €500 million.
Cognetas had no knowledge of the proposal made to its LPs regarding a full portfolio sale, according to a source close the firm. And at least one limited partner contacted by Private Equity International had not received the reported letter.
These developments have arisen just before Cognetas holds its annual investor meeting in Paris Thursday. According to the Financial Times it planned to discuss the restructuring plans there.