DBG Eastern Europe, the private equity house set up with the backing of German private equity firm Deutsche Beteiligungs in 1996, has completed a first closing at E67.2m for its second fund targeting later-stage investments in the region.
DBG Eastern Europe II LP is the successor fund to the DBG Osteuropa Fund, which was launched in 1997 and has since returned nearly four times its original investor commitments. The first close of DBG Eastern Europe II has been completed with the backing of the predecessor fund’s limited partners: Deutsche Bank, EBRD, Mitsubishi Corporation and DEG. The second and final close will concentrate on attracting commitments from new investors.
DBG Eastern Europe will focus on later stage investments such as expansion financing, management buyouts and buy-ins and industry consolidation transactions. “We will aim to invest between E5m and E12m per company, a slight increase on our fund I investment range,” said Jaroslav Horak, partner at DBG Eastern Europe. “The fund will be generalist, although we expect to see more opportunities in manufacturing, whereas the first fund made more investments in service companies.”
The DBG Osteuropa fund invested across a range of industries, including internet, software, printing, publishing and logistics. The firm operates from its network of offices in Budapest, Prague and Warsaw. The fund will target the core EU accession countries of Czech Republic, Hungary and Poland, with a secondary focus on Croatia, Slovakia, Slovenia, South Eastern Europe and the Baltic Republics.
Horak said the firm’s pipeline was promising, and that the first investment from the new fund was expected in the near future. Last year, DBG Eastern Europe sold its stake in the Hungarocamion, its second exit since its exit of Czech On Line in mid-2000.