Signs of life continue in the fundraising market, with MVision Private Equity Advisers celebrating two oversubscribed fund closes for clients this week: Oslo-headquartered HitecVision and Netherlands-based Gilde Buy Out Partners.
Oil and gas-focused private equity firm HitecVision took the market by storm with an offering outside its traditional fund platform: its “Asset Solutions” fund raised $420 million in just three months, surpassing its $325 million target.
“The quality of the general partner is very, very high,” said Mounir Guen, MVision’s chief executive. He added that the energy sector is a particularly attractive investment theme with limited partners at present.
The fact that we have been able to achieve this in such a short period of time and during a period of great uncertainty has been very rewarding.
Senior HitecVision partner Arne Trondsen said there is a lack of capital in this sub-set of the oil and gas industry, as opposed to two years ago when there was too much.
The fund's aim is to solve “complex situations”, potentially taking over some existing projects launched by incumbent players that overestimated demand and underestimated financial risks, Trondsen said.
Asked how the catastrophic Deep Water Horizon oil rig explosion and continuing leak in the Gulf of Mexico would affect the fund's investment thesis, Trondsen said that while HitecVision is not primarily focused on that particular region, some of the disaster's implications may prove positive.
“One thing is that the oil companies are going to be even more concerned about what type of equipment they will be using, which fits very well into the thesis of this fund,” he said. The fund will have an emphasis on its five to six portfolio companies using cutting-edge equipment, which tends to have the highest safety standards, he added.
HitecVision’s traditional private equity funds focus less on the asset-intensive side of oil and gas industry. Its most recent such vehicle, Fund V, raised $816 million in 2007 and has made five investments to date. Prior funds are understood to be performing strongly; the firm’s third fund exited its final investment in 2008 and returned nearly 5x to investors.
Separately, fellow MVision client Gilde Buy Out Partners last night hit the €800 million hard-cap on its fourth fund to target the mid-market in the Benelux and the French and German speaking regions of Europe. The firm began fundraising in the autumn of 2009.
MVision declined to comment and Gilde could not immediately be reached for comment.
The group’s prior vehicle closed on €600 million in October 2006. Gilde Buy Out Partners was last year ranked fifth in terms of the world’s top-performing GPs by private equity scholar Oliver Gottschalg. The research looked at 85 private equity firms that raised a total $345 billion through 257 funds between 1996 and 2005 and supports the view that firms specialising in niche markets often have the best performance.