Polaris nears Fund IV close

The firm expects to close its fourth fund, which has already hit its target of €400 million, in Q2.

Danish firm Polaris Private Equity expects to close its fourth fund, which is already above its €400 million target, in April or May, Private Equity international has learned. The firm is waiting for a few remaining investors to commit.

“We have kept the door open for re-ups and new investors and are giving them more time to get on board,” Polaris managing partner Jan Johan Kuhl told PEI.

Polaris Private Equity IV held a first close in January 2015 on €300 million and had already reached its target by its second closing before June last year.

The new vehicle has seen a significant amount of re-ups and follows the same structure as its previous fund, a 2009-vintage, €365 million vehicle, with half of its investors from Denmark and half international, Kuhl said. “We have good diversification.”

Investors in Fund III include Denmark’s ATP Private Equity Partners, PFA Pension and AP Moller-Maersk Group, France’s Access Capital Partners and the UK’s Alliance Trust Equity Partners, according to PEI Research & Analytics.

Fund IV has made three investments over the past 12 months and is already 20 percent deployed. Fund IV announced its first investment in June, the acquisition of Danish broadcasting technology provider TRIAX A/S from Nielsen & Nielsen Holdings. It has also invested in Danish ferry company Mols-Linien, as reported by PEI.

Its third acquisition, the firm’s first investment in a software company, was announced today. Polaris has acquired a 65 percent stake in Denmark’s Configit. The company, which has offices in Europe, the US, China and India, supplies configuration software to businesses globally, to companies such as Jaguar Landrover, MAN Truck & Bus, Fiat, Siemens and Phillips.

The size of the transaction was not disclosed but it fits within the firm’s usual range, Kuhl said, describing it as a typical Polaris transaction. The firm targets lower mid-market buyout opportunities in Denmark and Sweden with an enterprise value of €40-100 million, and in companies with an annual turnover of more than €25 million.

“We have done 33 deals with only three or four secondaries. Seventy percent have been succession deals and that is exactly what has happened here. It is in a new sector [for the firm], but it is a well-established company, profitable and we will support it to take it to the next level and take it further internationally.”

Configit’s existing owners, IT and telecom entrepreneur Michael Moesgaard Anderson, Hendrik Reif Anderson, who is CEO and will remain in the position, and Henrik Hulgaard, its chief technical officer, will remain shareholders.

It reported revenues of DKK 128 million ($19 million; €17 million) in 2015, representing 100 percent growth on the previous year, of which 95 percent was generated outside of Denmark.

Having already invested in industry, services, retail and consumer and e-businesses sectors, Kuhl described the firm’s move into software and technology as “a natural evolution”. It has established a team of three to four professionals who have been looking at deals in the sector for two to three years.