Rothschild’s Five Arrows seeks €1bn for European buyouts – exclusive

The firm aims to close Five Arrows Principal Investments III this quarter, Private Equity International has learned.

Rothschild Merchant Banking is looking to raise €1 billion for its third pan-European buyout fund, Private Equity International has learned.

The firm’s private equity unit aims to close Five Arrows Principal Investments III in the first quarter of this year, according to a source with knowledge of the vehicle. FAPI III will target companies with enterprise values of €75 million to €300 million in healthcare and education, data and software and tech-enabled business services.

Rothschild Merchant Banking declined to comment.

The FAPI team, which operate from London, Paris and Luxembourg, closed Fund II on €781 million in 2015, according to the Rothschild & Co website. FAPI I collected €583 million in 2010 and is being realised.

The team’s European portfolio includes UK medical diagnostics business The Binding Site, Italian food manufacturer Forno d’Asolo and French risk management firm Socotec.

Rothschild Merchant Banking invests in the US through its Five Arrows Capital Partners fund, which closed on more than $655 million in September. Limited partners included corporations, institutions, international family offices and entrepreneurs, the bank said in a statement at the time. Rothschild & Co, the partners and senior staff of the firm and the fund’s investment executives made a “substantial commitment”.

FACP has invested in UK-based risk management software provider Datix and Chicago behavioural specialist The Stepping Stones Group.

Rothschild Merchant Banking also raised €655 million for Five Arrows Direct Lending last May and €451 million for Five Arrows Secondary Opportunities IV in 2016. The firm has around €9.3 billion in assets under management.