Eurazeo forays into Spain with GP interest in MCH PE

The Paris-listed investment firm has picked up a minority stake in Madrid-based MCH Private Equity as part of its internationalisation plans.

Eurazeo, one of Europe’s largest investment firms with €17 billion in assets under management, has added Spain to its growing list of markets it wants to expand into.

The Paris-listed firm last week made a €100 million commitment to Madrid-based private equity firm MCH Private Equity for a 25 percent stake, as well as a commitment to the firm’s fifth vehicle, Eurazeo said in a statement.

With the Spanish economy doing well and Spanish private equity maturing, it was an opportunity for the firm to have “deeper connections” in the country, Eurazeo managing partner Frans Tieleman told Private Equity International. 

MCH will also benefit from Eurazeo’s PME fund series, which focuses on mid-cap companies in Europe. Its third and latest vehicle raised €658 million from investors in 2017.

MCH stays fully independent following the deal and expects to launch MCH Iberian Capital Fund V in the coming months, according to the statement. MCH is a mid-market focused firm with aggregate funds under management of €850 million, the firm said on its website. It invests in food and agribusiness, healthcare, business services and tourism sectors. The firm had raised €350 million against a €300 million target for its fourth vehicle in 2017.

Eurazeo has previously acquired stakes in other asset managers: last year it acquired a majority stake in French fund of funds manager Idinvest Partners for about €230 million, creating a group with more than €15 billion in AUM.

The firm also picked up a 30 percent stake in New York-based Rhône Group for $100 million in 2017 and a 22 percent stake in European private equity firm Capzanine in 2015. It sold Capzanine to AXA for approximately €82 million in January.

Since 2013, Eurazeo has ramped up its internationalisation plans. It opened an office in Shanghai and Brazil in 2013 and 2015, respectively, and in 2016 it established its first US office in New York. The firm planned to invest about a third of its assets under management – around €6 billion at that time – in the US over the next five years, Philippe Audouin, chief financial officer and member of the executive board, told PEI in 2017.

Last month, Eurazeo was selected by China Investment Corporation, the world’s second-largest sovereign wealth fund, to manage a China Growth Fund that will have up to €1.5 billion to back French and European companies that want to expand in China.