French tycoon takes 5 percent stake in Warburg Pincus

Family holding company Groupe Marc de Lacharrière (GML) has taken a 5 percent stake in US private equity firm Warburg Pincus.

The move will see Marc Ladreit de Lacharrière become a senior strategic partner at Warburg Pincus, with GML looking to invest in Warburg Pincus’s future funds as a limited partner.

Warburg Pincus declined to comment on additional financial terms of the transaction.

According to industry sources, GML will be a passive investor in the group with no governance rights, but will provide strategic advice to deal teams at the firm.

GML is Ladreit de Lacharrière’s family holding company. It owns several investments, including an 86 percent stake in listed French diversified finance group Fimalac, which owns Fitch Ratings.

Warburg Pincus said in a statement that it would use all proceeds from GML’s investment to invest in its funds, which would help to enhance the “alignment between the firm’s professionals and limited partners, and to create additional financial flexibility for the firm.”

Charles R. Kaye, co-chief executive of Warburg Pincus, said: “Warburg Pincus has always valued clearly aligned interests – within our general partnership, with our limited partners who invest in our funds and with the management teams of the companies in which we invest. We know GML shares that commitment and this transaction is consistent with those interests.”

Fimalac, a publicly traded company in France, is a diversified group active in finance (Fitch Ratings), digital, entertainment, leisure activities, luxury hotels and real estate.

Warburg Pincus currently has $35 billion of assets under management. It currently has one fund in market, Warburg Pincus XII, a global private equity fund that is understood to be approaching its $12 billion target. According to industry sources, it is due to hold its final close within the next few months.

The firm’s previous global private equity fund, Warburg Pincus XI, closed on $11.2 billion in 2011, while its most recent fund close was that of the $4 billion Warburg Pincus Energy Fund in 2013.