Exclusive: Apax nears $250m first close on Israeli fund

The fund, which came to market earlier this year, is targeting $300m

Apax Partners is nearing a $250 million first close on its latest Israel fund, PEI has learnt.

AMI, Apax’s local Israeli mid-market fund, will hold the close in the coming week, according to a source familiar with the matter. The first close includes a $40 million GP commitment, the source added.

AMI came to market earlier this year and is targeting $300 million. It is understood the fund could exceed its target.

Apax declined to comment on fundraising.

The fund will target investment opportunities in Israel and will write average equity cheque sizes of between $20 million and $50 million per deal.

Apax’s local Israel team has been operating in the region since 1994. Since 2005, Apax has invested €972 million in buyouts in Israel. The firm hasn’t has an Israel-focused fund since it raised a $102.5 million vehicle in 1999 and a $40.1 million in 1994.

In May, Apax sold its 56 percent stake in Tnuva, one of Israel’s largest food companies, to Bright Food Group, a food and agriculture business in China, for approximately $2.5 billion, netting Apax a 5x return. Large Israeli and Israel-related buyouts made by Apax have delivered a 33 percent gross annual IRR, the source added.

Apax is keen to capitalise on the current deal flow opportunities in the country, particularly in the technology and telecom, consumer, services and healthcare sectors, it is understood. The firm sees the region as attractive due to the fact there’s limited PE competition, reasonable pricing and a solid supply of deals, the source added.

Apax is not the only firm that is currently raising capital for Israel. Viola Private Equity, an Israel-based growth capital firm, held a $100 million first close on its second fund in early September. The fund, which is targeting $250 million, has amassed an additional $50 million in commitments since then, PEI reported in October.