Epiris holds first close on new fund – Exclusive

The UK firm has amassed £500m for the vehicle, its first as an independent manager.

Epiris, a UK private equity firm formerly known as Electra Partners, has held a first close on its new fund, Private Equity International has learned.

The firm has amassed £500 million ($652 million; €586 million) for the vehicle – its first as an independent manager – which launched in early 2017 with a target of between £800 million and £1 billion, according to investor sources.

The firm is aiming to hold a final close for the fund in the autumn, the sources added.

Epiris declined to comment on fundraising.

The £500 million is inclusive of “firmly committed” capital allocated for co-investment, the sources said.

It is unclear how much of the total is allocated for co-investment, or whether the co-investment capital will invest in all transactions made by the fund. The fund target is not inclusive of the co-investment capital, it is understood.

Terms and conditions and the fees attached to both the main pool of capital and the co-investment capital are unknown.

Epiris has returned £2 billion in the last 12 months, including through six exits that have returned more than 3x. Among these exits were Treetops Nurseries, which delivered 6.5x and an internal rate of return of 59 percent; AXIO Group, which delivered 5x and a 76 percent IRR; Audiotonix, which delivered 4.8x and an IRR of 50 percent; and Hollywood Bowl, which returned 3.9x and an IRR of 92 percent.

Epiris will continue with the same investment strategy it followed previously, focusing on value investing and business transformation. The fund will seek buyouts of UK companies with an enterprise value of up to £300 million and “loan to own” transactions.

London-headquartered Epiris managed the portfolio of Electra Private Equity for 30 years, and this relationship ended after the listed fund – now under the control of activist investor Edward Bramson – served notice on its long-standing fund manager in May 2016. In December it changed its names to Epiris and adopted new branding “to reflect its future and its independence from Electra Private Equity PLC”, as reported by PEI.

Epiris will manage the assets of Electra Private Equity until the end of May 2017, at which point management will shift to a team assembled in-house as the entity morphs from a listed investment trust to a corporate structure.