Schroder Ventures International Investment Trust plc (SVIIT), the UK-listed private equity and fund of funds investor, has held a first close of its second fund, Schroder Private Equity Fund of Funds II, on E110m.
The new fund is the follow-up vehicle to the E242m Schroder Private Equity Fund of Funds I, which closed in June 2002 and which is now fully invested. It will make investments in both buyout and venture capital funds predominantly in Europe and the US.
SVIIT also announced that it has invested E425m in the new European buyout fund raised by London-based house Permira, which today held a final close above E5bn. Having initially allocated E400m to Permira Europe III, SVIIT said an additional E25m has been committed in the fund. In addition, E450m has come from P123, SVIIT’s fund of funds which invests solely in buyout funds managed by Permira.
SVIIT launched P123 earlier this year in order to give investors access to Permira’s more mature funds via its interests in the three Permira funds. To date, P123 has received applications and commitments from external investors of E103m.
SVIIT will transfer E62.8m of assets in Permira Europe I and II to P123, at 30 June 2003 valuations, in return for an approximate 38 per cent holding in the structure.
P123 will have a final closing, targeting a further E102m of commitments from external investors, before the end of 2003, the firm said. At this final closing, SVIIT will transfer up to E65.9m of its assets in Permira Europe I and II on a pro-rata basis in order to maintain an approximate 38 per cent holding in P123.
Permira's successful fundraising process has meant that Permira Europe III has closed earlier than anticipated. As a result, potential P123 investors have been unable to make the commitment deadline. As a result SVIIT has agreed to hold P123 open for these investors.
“SVIIT has already indicated to its shareholders that it believes that the European buyout market is a highly attractive investment opportunity for SVIIT,” said Nicholas Ferguson, CEO of SVIIT. “Permira are one of the leading private equity firms in this area and a key driver of SVIIT's net asset growth. In order to provide for future potential net asset growth, we believe that it is in shareholders’ best interests for SVIIT to have a significant exposure to Permira Europe III, both directly and through P123.”