Austrian private equity firm Lead Equities has defied a tough fundraising environment to exceed the E40m target for its debut fund.
The firm, set up by founding partners Dirk Brandis and Stephan Zöchling, former senior employees of the Schroder German Buyout Fund and Constantia Privatbank respectively, has secured commitments from a range of international investors including Deutsche Asset Management and ACTIVEST in the final round. The majority of the capital for Lead Equities I was provided by major Austrian financial institutions, including Investkredit, Generali Insurance Holdings and Hypo Alpe-Adria. Lead Equities' management have also contributed to the fund.
“It’s a strong sign of confidence in our investment approach and the developing Austrian market” a spokesperson for Lead Equities said. “Whilst fundraising was challenging, especially for a first-time fund, our industrial and managerial network clearly set us apart from competition and proved a strong selling point to investors.”
Despite the note of optimism from Lead Equities, Austrian private equity players have struggled to hit fundraising targets, the result of a perceived lack of opportunities in the market, and a shortage of international investors. Last October, Go Equity held a final close of Go Equity II, on E54m, just over half the original E100m target. Last week, Gamma Capital Partners announced that it was planning to raise E25m for a high-tech VC fund.
Lead Equities I will look to invest between E1.5m and E10m in later-stage companies with an enterprise value of between E10m and E100m and will look to syndicate larger deals. It will focus on automotive, engineering, healthcare and consumer opportunities in Austria, Southern Germany and Northern Italy, and in Eastern Europe in Slovenia, Slovakia, the Czech Republic and Hungary.
Lead Equities has also announced that it has entered into a co-operation with AUCTUS, the Munich-based fund manager. The agreement is intended to enable the two firms’ portfolio companies to gain access to new markets.