Five Arrows reaches €493 million first close

The fund will focus on lower mid-market investments in Europe

Five Arrows Principal Investments, the corporate private equity business of Rothschild Merchant Banking, has reached the first close for its latest vehicle – Five Arrows Principal Investments II – on more than €493 million.

The fund will include a significant GP commitment, which is expected to bring total capital raised to date to €508 million. The firm is targeting €700 million for the vehicle, which has only been in market for a few months.

The fund will focus on lower mid-market private equity investments in Europe. Targeted industries include healthcare, education, business services, software, and opportunistic sub-segments of consumer.

Rothschild declined to comment on fundraising.

The investor base is primarily composed of LPs invested in the firm’s previous fund, and other Rothschild Merchant Banking funds. Five Arrows Principal Investments Fund I is a €585 million vehicle invested in 14 companies.

Most recently, the firm acquired Pirum Systems, a financial technology business providing post-trade solutions. Financial terms of the deal were not disclosed, but Five Arrows said in a statement that the transaction represented the final investment from Fund I.

Javed Khan and Emmanuel Roth are the co-managing partners for Five Arrows, which maintains offices in London and Paris.