In defiance of prevailing market conditions, Athens-listed investment group Marfin is seeking €5 billion of new capital via a private placement. The firm hopes the new money will enable it to capitalise on a consolidation opportunity in the Greek banking sector amid the ongoing global financial crisis.
Pantheon International Participations, the London-listed private equity investment trust, has announced it is focussing purely on the secondaries market for the “foreseeable future”. The trust, which has typically invested around 30 percent of its programme in secondaries, had committed £113 million to 13 secondary deals to the end of June 2008.
The increasing priority given to responsible investing is hinted at by the launch of a new €250 million fund of funds by Robeco, a division of the Netherlands' Rabobank. The fund, for which a first close is expected early next year, will focus on private equity funds adhering to a robust set of environmental, social and governance principles.
Stockholm-based Sustainable Technologies Fund has closed its debut vehicle on €58 million. The fund will invest in cleantech companies in Denmark, Norway, Iceland, Sweden and Finland. The firm is headed by Anders Frisk, former chief executive of The Natural Step, a Swedish company that advises business about sustainability.
Listed Paris private equity firm Eurazeo asked the French regulatory authorities to investigate a 19 percent one-day drop in its share price on 16 September. A statement from the firm expressed the view that it likely stemmed from a financial institution being forced to unwind a lending position guaranteed by Eurazeo shares, to which collapsed investment bank Lehman Brothers was the counterparty (see also p 91).
Against the backdrop of a slowing market, London-listed private equity firm 3i saw a 40 percent year-overyear decrease in investments to £633 million (€814 million; $1.1 billion) in the five months to the end of August 2008. Over the same period, realisations nearly halved to £560 million. 3i's new deal activity reflected its lessening emphasis on early-stage investments against an increase in buyout and infrastructure deals.
HarbourVest Global Private Equity, the Amsterdam-listed vehicle which invests mainly in Boston-based parent Harbourvest Partners' funds of funds, saw its net assets fall to $848 million in the six-month period ending 31 July, down 1.6 percent from the $862 million NAV reported at the end of January, according to the firm's unaudited semi-annual results.
The booming global infrastructure market will require $53 trillion of investment in the next 25 years according to AXA Private Equity chief executive Dominique Senequier, speaking at a press lunch. The demand comes from ageing infrastructure in OECD countries and the need for developing countries to support economic growth with new infrastructure. AXA PE recently launched an infrastructure initiative to invest alongside local partners in India and other Asian countries.
France has been identified as having Europe's best tax and legal framework for private equity firms in a study conducted by the European Private Equity and Venture Capital Association (EVCA). In a 27-country benchmarking exercise, Ireland came second, Belgium third and the UK fourth, while the Czech Republic was bottom of the pile. The study found that in Europe as a whole the fiscal and legal environment has got slightly worse over the last two years.
Fund managers are facing a “perfect storm” due to a confluence of political issues, credit market woes and “human excess”according to Veronica Eng, a partner and member of the investment committee at London-based buyout firm Permira. Chairing a panel discussion at the Guernsey Funds Forum in London, Eng added that “any fund manager worth its salt is currently concentrating hard on its portfolio companies and being very picky about the investments it makes”.
LAUNCHES AND CLOSURES
Spanish private equity fund of funds manager Altamar is likely to launch its fourth fund – its third focussing on buyouts – during 2009. As well as Altamar's normal mix of buyout funds in Europe and the US, the fourth fund will feature an allocation to special situations and an exposure to Asia.
London-based Electra Partners purchased Axa Private Equity's €45 million interest in Steadfast Capital I, a private equity fund raised by BHF Capital, the former in-house private equity team of German bank BHFBank, now called Steadfast. Steadfast joins Electra's list of foreign partners, which include France's TCR Capital, Italy's Sinergo and Spain's N+1.
BVT, the Munich-based investor in renewable energy and real estate, is partnering with Cukierman & Co to create a €200 million private equity fund. While details have not been disclosed, it is likely that the fund will invest in renewable energy projects in Europe. BVT, which has offices in Germany and the US, manages €1.5 billion in funds for green energy-related projects.
The shareholders of Macquarie Airports, a Macquarie Group-managed listed fund that invests in airports globally, have approved the A$1.5 billion ($1 billion; €.5 billion) sale of airport assets to Macquarie European Infrastructure Fund III, Macquarie's largest pan-European infrastructure investment fund. The sale includes the Macquarie Airport's interests in Copenhagen and Brussels Airports.
Arx Equity Partners has held an €83 million first close on its third Central and Eastern Europe fund focussed on lower mid-market investments. Arx was formerly known as DBG Eastern Europe. The firm's previous fund raised €67 million in 2004, and invested in such companies as Polish childrenswear retailer ‘5.10.15’ and manufacturer of climbing equipment Singing Rock.
Shaun Middleton, partner at UK mid-market firm Dunedin, believes that current credit market conditions could lead to more widespread use of vendor loans, which have generally been used in larger buyouts to bridge the gap between the price that vendors hope to achieve and the falling prices offered by bidders. “We may well see an increase in their usage at all levels of the market,”he said.
UK accounting firm Tenon has launched a fund management business, Tenon Capital Management, in order to capitalise on turnaround opportunities thrown up by the economic downturn. It is seeking to raise up to £20 million (€25 million; $33 million) for T-Fund I, which will invest in businesses with a turnover of between £5 million and £30 million.
Alchemy Partners will likely raise its second distressed debt fund in the spring of 2009. Alchemy founder Jon Moulton said that media reports estimating the target fund size of $1 billion were “a bit premature”. The firm's debut distressed debt fund closed in March 2007 on £300 million.