Exclusive: Adveq holds first close on co-invest fund

The firm’s debut co-investment fund aims to collect between €100m and €150m.

Adveq, the Swiss fund of funds manager, has held a first close on its debut co-investment fund, according to a source familiar with the matter.

The fund, which will target co-investment opportunities in Europe and came to market towards the end of last year, held a first close in April at around €50 million, the source said. It is aiming to raise between €100 million and €150 million. It is understood that Adveq plans to invest the fund in approximately two to three years, and has already done “a couple” of deals using capital from the new vehicle.

Adveq declined to comment.

While the firm can co-invest in larger transactions, Adveq mainly plans to do deals alongside GPs operating at the lower end of the market, the source added. The fund can invest in the whole of Europe but will primarily target the German-speaking region, the UK, France, Benelux and the Nordics, which is where the majority of Adveq’s GPs are based. It will mainly invest alongside the firm’s existing managers, although it can team up with other GPs as well.

The vehicle will be Adveq’s first blind pool co-investment fund. The firm has previously been co-investing alongside its GPs through its fund of funds programme and also via specific LP mandates. It has one team that works across its primary, secondary and co-investment deals.

Adveq didn’t participate in many co-investments pre-crisis because it felt the opportunities on offer were too cyclical, according to the source. This started to change in 2009 and 2010, and since then, the firm has been actively pursuing a co-investment strategy.

As a result, Adveq has seen its co-investment deal flow increase by around tenfold, the source added. In the last half year alone, it is understood the firm has completed approximately 12 co-investment transactions. This is one of the reasons why the firm decided to raise a separate co-investment fund.

Adveq is not the only firm that has succeeded in raising capital for a co-investment vehicle. Last month, HarbourVest Partners held a final close on $1 billion for its latest global co-investment fund, above its $750 million target. Last July, Lexington Partners also held a final close on $1.57 billion for its Lexington Co-Investment Partners III fund. The fund closed above its $1.5 billion target and is “one of the largest dedicated global co-investment funds”, Lexington said at the time.