EQT raises €1.1bn for mid-market fund

The fund, which came to market last February, collected 95% of its capital from existing investors.

EQT Partners, a Swedish-based buyout firm, has closed its Mid Market Fund on €1.1 billion after spending just under a year in the market.

The firm, which began fundraising in February 2013, held the fund’s undisclosed first close in June, according to an EQT spokesperson.

EQT collected 95 percent of the capital for this fund from existing investors. Just over half of the commitments came from investors in the Nordic region, followed by 22 percent from the rest of Europe, while 16 percent came from North America and 11 percent from Asia, according to EQT. The fund is backed by international institutional investors including pension funds, insurance companies and family offices.

EQT launched the fund after merging its Expansion Capital Fund team and Greater China Fund team. The existing Greater China and Expansion Capital funds will not merge with the new Mid Market Fund, according to an EQT spokesperson, who added the Mid Market team will manage out EQT’s Expansion Capital and Greater China funds.

The Mid Market Fund, which is led by Jan Ståhlberg, one of the founders and deputy managing partner of EQT Partners, will target middle market buyouts and growth equity investments in Northern Europe, Greater China and Southeast Asia.

Mid-market businesses “often lack the expertise needed to expand into new markets”, according to an EQT statement. The firm believes many companies can benefit from internationalisation, particularly by taking advantage of the increased trade linkages between Europe and Asia. “There is a significant opportunity to transfer business models and best practices across these geographies.”

EQT expects deal flow to come from family and entrepreneur-owned businesses, corporate carve-outs and public-to-private transactions. The firm will target companies with enterprise values ranging between €80 million and €150 million in Northern Europe and between €80 million and €200 million in Greater China and Southeast Asia. EQT plans to make 10 to 15 investments from the fund, PEI reported last April.

The fund has so far invested in five companies: Avenso, a gallery network and online retailer for photographic art in Germany; Swiss smile, a dental practice chain in Switzerland, data communication provider IP-Only in Sweden; BackWerk, a German franchise system in the self-service bakery and quick service food market and China F&B, which operates restaurant chains Dairy Queen and Papa John’s Pizza in China.