HgCapital held final closes this week on its two latest funds two weeks after Private Equity International reported the firm was nearing closes on the vehicles.
The London-headquartered private equity firm amassed £2.5 billion ($3.1 billion; €2.9 billion) for HgCapital 8 and £575 million for Mercury 2, according to a statement. The funds, which closed on their hard-caps, were more than 3x oversubscribed versus their targets and received strong re-ups from existing investors, the firm said.
PEI reported in January the firm had attracted investor demand worth more than £7 billion and that the firm was set to make a GP commitment of at least 2 percent to each vehicle.
HgCapital 8, invests across sectors, launched in September with a £2 billion target and held a first close on £1.9 billion in December. Last year, the firm completed 10 investments, seven realisations and three refinancings representing around £950 million in investment activity and returning around £1 billion to its investors, according to the statement, although it was not clear which of these were made through HgCapital 8.
Its Mercury 2 fund, which focuses on technology investments in Northern Europe, launched in November with a £450 million target. The firm’s Mercury team has invested in 12 businesses so far, and its debut fund sealed it sfirst exit last summer with the sale of Relay Software, making a 40 percent internal rate of return and a 2.1x investment multiple.
The Mercury portfolio, which includes its 2011-vintage £380 million HgCapital Mercury TMT vehicle, delivered aggregate revenue of 13 percent and EBITDA growth of 41 percent last year, according to the statement. It has delivered a 2.5x realised investment multiple and a 36 percent gross IRR across 14 investments over 16 years, with no capital losses.
Proskauer provided legal advice and Rede Partners advised on the fundraising, according to the statement.
HgCapital was formed in 2000 and has around £8 billion in assets under management. In addition to its London headquarters, the firm has an office in Munich.