US buyout firm HIG Capital revealed ambitious European growth plans today, as it closed a €600 million ($817 million) fund to target deals in the lower mid-market.
HIG European Partners, the US group’s first dedicated fund for investments in Europe, hit its hard cap of €600 million after attracting commitments from both existing limited partners in HIG funds and additional European investors.
The firm is rapidly building its European team with a series of local recruits to match its investment capacity. It has already hired nine local professionals across its three offices in London, Paris and Hamburg, and expects to have as many as 30 by the end of the year – a swift expansion from a standing start.
Managing director Paul Canning, who joined from UK firm Gresham Private Equity, told PEO that the firm was looking to build a team with “a real mix of skills”, both operational and financial. This was critical to the firm’s flexible investment approach, he said, which involves partnering with businesses in a broad range of circumstances.
The fund will target companies in the lower mid-market, typically investing £5 million ($10 million, €7.4 million) to £20 million of equity in businesses with enterprise values of less than €150 million.
HIG co-founder and managing partner Sami Mnaymneh is relocating to London to manage the team. The firm’s previous experiences of buying businesses in Europe – most recently French manufacturing group Diam Europe in March – convinced it that now was the right time “to move more permanently into the market”, he said.
HIG is not the only US firm looking to build a business in Europe. Vestar Capital and Highland Capital are just two of the other firms currently expanding their operations in the region.