HgCapital closes on £2bn hard-cap

The European private equity firm was ‘significantly oversubscribed’ for its latest fund focusing on buyouts in Northern Europe.

HgCapital has raised £2 billion (€2.3 billion; $3.1 billion) for mid-market opportunities in Northern Europe, according to a company statement. 

Like its predecessor, Fund VII will focus on investments with an enterprise value in the range of  £20 million to £500 million in the healthcare, industrial, services and TMT sectors. The firm has not yet invested any of the fund's capital.

Fund VII was oversubscribed, having originally targeted £1.75 billion, the same target as its previous fund, which closed on £1.9 billion in 2009. Fund VII started marketing in October 2012 and held a £1.75 billion first close at the end of March, according to a source familiar with the matter.

Fund VII's largest commitment — £200 million — came from Hg's listed trust, HgCapital Trust. Other commitments were “well diversified by geography, investor type and commitment size”, according to the statement.

Previous Hg limited partners include BBC Pension Trust, Colorado Public Employees' Retirement Association, Daily Mail and General Trust Pension Funds, Teachers' Retirement System of Texas, Surrey County Pension Fund, Quartilium/Groupama Private Equity, Maryland State Retirement and Pension System, RWB Private Capital Fonds, Employees Retirement System of Texas, Ilmarinen Mutual Pension Insurance Company and West Midlands Pension Fund, according to PEI's Research & Analytics division. It was unclear at press time how many investors in Fund VII were new versus returning LPs. 

Hg was unavailable for further comment at press time.

“We are extremely grateful for the support we have received from investors and we are thankful that our clients have helped position us for success.  Ultimately, 'HgCapital 7' will be measured not by its fundraising success, but rather the returns generated for our clients,” Craig Donaldson, partner and head of business strategy and client services, said in a statement.

Proskauer provided legal advice, with Credit Suisse acting as an advisor on the fundraising.

Hg was voted firm of the year in the UK for 2012 in PEI's annual awards. 

Clare Burrows contributed to this report.