Former senior executives from some of Europe’s best-known private equity firms have gathered €440 million for their debut vehicle focused on the European mid-market.
CGE Partners raised €40 million more than its original target for its debut offering, Private Equity International has learned. It is unclear when CGE began raising capital for the vehicle.
The firm is led by managing partner Nick Heslop, a former director at Bridgepoint; partner Chris Fielding, previously a partner with Milan-based Charme Capital Partners; and director Chloe Holding, an ex-investment director at Inflexion Private Equity, according to a source with knowledge of the matter.
Capital raised for the fund will be invested in companies with an enterprise value of up to €200 million. Target sectors are business and technology services, healthcare, financial services and consumer and leisure. Ticket sizes are between €20 million and €80 million, with scope for larger deals via co-investments, the source added.
CGE will hold investments for three to five years but will have scope to hold assets for longer via a sidecar vehicle, it is understood. Such companies would be initially held in the main fund and transferred out into a longer-term holding company.
It is understood the sidecar will be funded separately and the firm expects about a quarter of its portfolio to be held in the new vehicle. CGE’s flexible hold period allows the firm to take a longer-term approach to its value creation initiatives, as well as avoid multiple transactions, ownership and control premiums, the source added.
The strategy is in line with the increasing trend of firms setting up long-duration vehicles, including CVC Capital Partners’ Strategic Opportunities and KKR’s Core Investment Funds, which hold assets for longer than the traditional 10-year vehicle. TA Associates’ TA Select Opportunities Fund is another similar example. Capital raised for that fund will pick up minority stakes in companies owned by the firm’s main funds to hold those investments for longer.
CGE declined to comment on fundraising.