Mercapital hard caps third fund on €550m

The Madrid-based private equity firm has posted a final close of its latest fund, which will focus on mid-market buyouts in Iberia.

Mercapital has closed its Spanish Buyout Fund III on a hard cap of €550 million ($732 million), ahead of an original €500 million target.

In a strategic shift, the fund will focus entirely on mid-market buyouts. By contrast, only two-thirds of the firm’s prior fund – Fund II – was dedicated to buyouts, and the other third to growth capital. However, the predecessor fund was larger, closing on €600 million in 2001.

Mercapital said existing investors committing to the new fund included Access Capital, Goldman Sachs, Pantheon and Unigestion, while “selected new” international investors included BP Pension, CAM Private Equity, European Investment Fund and Quartilium. Spanish institutions and family offices, which only recently began investing in private equity, accounted for “close to 30 percent” of the total raised.

MVision Private Equity Advisers acted as exclusive global placing agent on the fundraising, while SJ Berwin acted as Spanish legal adviser, Ropes & Gray as US legal adviser and PricewaterhouseCoopers provided tax advice.

Mercapital is set to be superseded as the manager of Spain’s largest private equity capital pool. Magnum Industrial Partners, headed by former Banco Santander CEO Angel Corcostegui, is expected to announce a first close early next year for its debut fund, which has an €850 million hard cap.