LBO France is latest firm to set sights on individual investors

The firm follows the likes of Blackstone and Pomona Capital in offering products to retail investors.

Paris-based LBO France has launched a fund specifically for high-net-worth clients.

The FCPR White Caps Sélection fund will have a minimum investment amount of €25,000 and will invest both directly and via funds managed by LBO France in unlisted French or European small or mid-cap companies, according to a statement from the firm.

The fund will invest in both expansion capital and buyout capital transactions and will also have the ability to invest in real estate “to ensure additional diversification”.

LBO France declined to comment on the target size or terms of the fund. The firm is the latest to set its sights on retail investors as a potential capital source. In 2015, Pomona Capital partnered with Voya Financial to launch Pomona Investment Fund, which allows a minimum commitment of $25,000.

Last year Blackstone signed agreements with three unnamed IBD firms to provide real estate and hedge fund products to retail investors, with the potential to open up the channel to include private equity and other Blackstone products, as reported by PEI.

LBO France’s 15 investment professionals and six-person operating team will be working on FCPR White Caps Sélection and its investments, the firm noted.

In a statement, LBO France chairman Robert Daussun said the fund responds to a need.

“High-net-worth clients are currently looking for diversified investments directly connected to the real economy and protected from the often erratic fluctuations of stock markets,” he said.

FCPR White Caps Sélection will also offer risk pooling, as it is a multi-strategy approach, Daussun added.

LBO France said it is relying on wealth management professionals for the fund who have been selected “at an early stage of the process” because of their knowledge of private equity. Several of them have been involved in “all stages of the creation process” of the fund.

The vehicle is a tax fund under French law, allowing exemption from income tax on capital gains subject to a minimum holding period of five years, the statement noted.

LBO France held the final close on its White Knight IX fund on €450 million at the end of 2016 after more than three years in market, below its initial €1 billion target. It also invests from a small-cap buyout fund that targets French and Italian companies with an enterprise value below €100 million. On the venture capital side, the firm will make one more investment from its first Digital Health fund and is preparing to launch a successor vehicle.

The firm held a first close on White Stone VII, its latest value-added real estate fund, in July and anticipates holding a final close by December.

Click here for PEI’s series on the rise of the individual investor