Exclusive: Stirling Square plans to raise €500m

The firm, which added two dealmakers to its team this week, has hired Rede Partners to raise its third fund next year.  

Stirling Square Capital Partners, a European firm focused on the mid-market, is preparing to come to market in 2014 to target €500 million for its next fund, according to sources familiar with the matter.

It is understood Stirling has recently hired Rede Partners to place the fund. Stirling Square and Rede Partners declined to comment on fundraising.

Stirling is currently investing its second fund, a €375 million, 2010-vintage vehicle. That fund includes a general partner commitment of €28 million, representing roughly 7.5 percent of the total fund.

From this vehicle, Stirling invested in Microtecnica, an Italian technology and design authority for the airspace industry, which is understood to have generated a return of approximately 10x.

Stirling’s ability to deploy its forthcoming fund has been bolstered by the expansion of its investment team. It has re-hired Jonathan Heathcote as a partner and also hired Matteo Nichil as an executive, it said in a statement.

Heathcote joined from Palamon Capital Partners where he was one of six partners responsible for the origination, execution and management of European mid-market investments, primarily in Spain, Germany and the UK.

Heathcote was a consultant to Stirling Square from 2007 to 2008 and was involved in a number of notable transactions during that time, including the acquisition of Italian aerospace company Microtecnica.

Between 2002 and 2007, he was a partner at European Acquisition Capital where he was responsible for sourcing, executing and managing a portfolio of investments, primarily in the UK and France. Prior to this, Jonathan was a consultant at McKinsey and an officer in the Royal Marines.

Prior to Stirling Square, Matteo Nichil worked as an associate in the M&A team at Bank of America Merrill Lynch. He has a range of transaction experience in the consumer and TMT sectors, according to the statement.

Heathcote’s skills “will complement the existing team well as we continue to grow Stirling Square”, Stefano Bonfiglio, managing partner, said in the statement. “Matteo has proven transaction execution skills and will provide additional support to the team on opportunities arising across Europe,” he added.

Stirling Square Capital targets businesses with enterprise values of between €50 million and €500 million. The firm manages two funds, totalling more than €800m capital under management and has made 19 investments since it was established in 2002.