Richard Winckles and Alex D'Janoeff appear to like boats. In February, their private equity firm Balmoral Capital bought UK yacht builder Oyster Marine for an undisclosed sum. Last year they purchased Italian motor yacht maker Canados.
According to Winckles, Balmoral's third deal is unlikely to be in boats. Neither are the two men going to spend much time sailing in the months to come. They have a fund to invest and a business to build.
The firm's fundraising from 2004 to 2006 was challenging, according to Winckles, who declined to disclose the names of Balmoral's investors nor the amount of capital the firm has raised. The firm's initial target in 2004 was €600 million ($884 million). It initially worked with placement agent MVision on the fundraising.
Winckles said: “The fundraising was very difficult frankly. All I can say is you should try raising a first-time fund. It is difficult to get a first-time fund away and there was concentration around brand names with a surge of money towards the recognised funds in 2005 to 2006.”
Winckles and D'Janoeff founded the firm, which invests in businesses with enterprise values of between €30 million to €350 million, having met working at Schroder Ventures, the firm that became Permira. They then went on to work together at Credit Suisse First Boston Private Equity, where Winckles was a managing partner and D'Janoeff a managing director.
Winckles said he liked working in the mid-market as he feels he is able to spend more time working with management than if he were to work on mega buyouts: “I know someone who was working on a huge transaction at one of these firms and he didn't even get to meet the management,” he said.
Winckles and D'Janoeff are certainly going to have regular meetings with the managers of Oyster Marine. According to Winckles, the business is “largely recession resistant” as it provides boats to high net-worth individuals whose dream is to own their own vessel. “Often they've made their money and are in their 50s and it's a life style choice,” he said.
Oyster Marine has 18 months' forward orders and inquiries at the London Boat Show, a trade show, were nearly a quarter up on last year despite less people attending the event, he said. The company presently makes 40 boats a year and charges an average £1.2 million.
PELLICIOLI JOINS PALAMON
Lorenzo Pellicioli, chief executive of the powerful Italian conglomerate De Agostini, has joined the advisory board of European mid-market private equity firm Palamon Capital Partners. Pellicioli was chief executive of the directory business Seat Pagine Gialle between 1997 and 2000, during which time he led the company's original buyout deal. The company became the subject of Italy's biggest leveraged buyout in 2003. Pellicioli's interests range across a number of sectors: he is also on the board of Generali Insurance. DeAgostini joins ten other business leaders from six countries on Palamon's board, including Ron Sandler, the new government-appointed executive chairman of the nationalised UK bank Northern Rock. Also on the board is Tom Sommerlatte, chairman of Arthur D. Little's management consulting activities in Germany and Austria. Italy is Palamon's third-largest market, accounting for 14 percent of its portfolio.
HIG HIRES FOR EUROPE PUSH
Olivier Boyadjian, former head of investments for French private equity firm CDC Capital Investissement, is joining US mid-market firm HIG Capital as head of its Paris office. HIG closed its first European fund last July on €600 million and followed this by opening offices in London, Paris and Hamburg, saying it intended to hire more than 30 investment professionals in Europe by the end of 2007. The firm now has more than 35 professionals. The Paris team also includes Patrick Caron, previously the head, who came from Bank of America Capital Europe. HIG Europe is targeting small and medium-sized companies with valuations of up to €200 million, and its strategy includes growth capital, buyouts and distressed investing.
BVCA LAUNCHES NEW DUAL STRUCTURE
The BVCA has launched two committees to focus on global buyout and mid-market firms to complement its existing venture and enterprise sector committees. It is an attempt to repair the apparent schism that was developing between the mega-funds and the mid-market firms. Jeremy Hand, incoming chairman of the BVCA, said: “Our member firms have given us a clear mandate. They want a single organisation with a structure that fully represents the UK private equity and venture capital industry.”
The new global buyout committee is led by Robert Easton of the Carlyle Group and includes representatives from Blackstone, KKR, TPG, 3i and Cinven. The new mid-market committee is chaired by Tom Lamb of Barclays Private Equity and includes senior members of Legal & General Ventures, Advent International, August Equity and Close Brothers Private Equity. The BVCA has also restructured its council. It now has three representatives of each of the sectors, as well as the chairs of each of the technical committees, the chairman, vice chairman and past chairman.
CLIMATE CHANGE CAPITAL PREPARES FOR REAL ESTATE MOVE
Climate Change Capital has hired two real estate professionals, indicating that it is about to launch a property fund for the first time to invest in low carbon buildings. Esme Low joins from Capital Trust, a property investment management firm, and Tim Mockett moves from Stow Securities where he created a £200 million portfolio of mixed-use, office and retail properties. Climate Change, which is led by chief executive Mike Woodall, has around $1.5 billion of assets under management within a series of funds investing in companies promoting a low carbon economy and reducing green house gases. Woodall said: “The value of commercial property will increasingly be driven by sustainability and climate change issues. The move to create low carbon buildings will accelerate, and both occupiers and investors will drive this shift motivated by the desire to reduce energy costs, corporate social responsibility, brand value and the need to future-proof their properties.”
AUGUST HIRES DAWN RAIDER
August Equity has recruited David Lonsdale to its investment team from broadcasting company British Sky Broadcasting, where he worked in the corporate finance division. Lonsdale worked on the acquisition of a 17.9 percent stake in ITV and the acquisition of You Me TV. Lonsdale previously worked for ITV as a business development manager, and for KMPG's corporate finance group. Andrew Hartley, joint managing partner of August Equity, said working in the M&A departments of large corporates was a good place to gain experience. Yet by the nature of the beast you are restricted in your activities. “In private equity you don't have those groundhog days, plus you have the opportunity to see acquisitions through,” Hartley said.
CLOSE BROTHERS TO FOCUS ON MANCHESTER
Close Brothers, an independent corporate finance boutique, is opening an office in Manchester and has recruited Richard Pulford to head the office and its North West regional operations. The firm hopes Pulford's arrival from accountants PricewaterhouseCoopers will help it capture a greater share of the advisory mandates which last year amounted to 328 transactions valued at over £9 billion in 2007. At PwC Pulford has been a director in both Manchester and London corporate finance businesses since 2004. Before that he worked two years on second-ment to the Takeover Panel, dealing with cases such as the £6 billion hostile bid for pub chain 6 Continents and the contested takeover of Pizza Express, the restaurant group. He has also advised on some high profile local and national transactions, including the sale of Liverpool Football Club; the public-to-private both of retailer Matalan; as well as the demutualisation of Interflora, the UK florist. Close Brothers has already advised a number of clients in the region, including Enterprise on its £486 million sale to 3i.
LEWIS LA TORRE JOINS PARISH
Parish Capital Advisors, a dedicated UK private equity investment management firm, has expanded its capabilities in Europe with the hiring of Catherine Lewis La Torre. Lewis La Torre, formerly a co-founder of the Finnish fund-of-funds group Proventure, has joined Parish Capital as a venture partner. As a founder and investment director at Proventure, Lewis La Torre was involved in all aspects relating to the investment process as well as the management of the firm. Lewis La Torre was a member of Proventure's investment committee that approved over 40 primary fund, secondary fund and direct investments and she sat on a number of supervisory and advisory Boards.