Progressio, an Italian mid-market private equity firm, has launched its fourth fund with a target of €225 million, according to a statement from the firm.
The firm is targeting a first close in the summer and a final close at the end of 2017 for Progressio Investimenti III, which was launched “in response to LP demand and a doubling of proprietary deal flow over the past five years,” the firm said.
Cebile Capital is acting as advisor and placement agent for the fundraise.
Sunaina Sinha, managing partner of Cebile, said in a statement that she expects the fund to be oversubscribed.
“When you see what this group has achieved over the past decade, in difficult economic circumstances, it’s not a surprise that LPs around Europe view Progressio as a haven amid the continent’s political turbulence,” she said. “They operate above the market but sensibly.”
It is understood that Progressio will be making a GP commitment to the fund of between 4 percent to 5 percent.
Should the fund reach its target, it will be slightly larger than its predecessor, the 2010-vintage Progressio II, which closed on €205 million and is on-track to deliver a multiple on invested capital of 2x with a distributed-to-paid-in ratio of 69 percent, according to the firm.
Founded in 2005, Progressio has made 19 investments and 16 exits, delivering a cash-on-cash return of 3.5x, the firm said.
Its first vehicle, MPE, a 2005-vintage, raised €43 million and delivered a multiple on invested capital of 7.1x and an internal rate of return of 93 percent. Its second, the €100 million Progression I, delivered 3.2x MOIC and 54 percent IRR.
It was unclear whether the IRR figures are net or gross of fees.
Previous Progressio investments include luxury outerwear brand Moncler, hydraulics business Duplomatic, and pharmaceuticals business Italchimici.
As its predecessors, Progressio Investimenti III will invest in Italian mid-market business with revenues of between €30 million and €150 million. The management team is targeting exit returns of more than 2.5x from each portfolio company over three-to-five-year horizons.
Progressio managing partner Filippo Gaggini said the firm already has “a strong pipeline of new deals”.