Michele Russo has left European private equity firm Doughty Hanson, where he had been a partner since 1998. Russo, who was based in Milan and headed Doughty’s Italian operation, has become the fourth partner at Lazard European Private Equity Partners (LEPEP).
At LEPEP, Russo joins three other partners: Graham Keniston-Cooper, formerly of London-based buyout firm Cinven; Victor Vadeneaux, who joined from global investor Advent International; and Gilles Etrillard, the head of Fonds Partenaires Gestion, Lazard’s existing French private equity business.
Lazard, which has not yet announced details of a fundraising, is expected to target mid-market European businesses with an enterprise value between €50 million and €250 million.
At Doughty Hanson, Russo has been replaced by Alioscia Berto, whose promotion was announced at the end of last week. He joined Doughty Hanson in 1998, having previously worked at ING Barings in its M&A department, and at KPMG Corporate Finance in Milan. He will head up a team of three.
Having launched its Milan operation six years ago, Doughty Hanson has made one investment in Italy to date. In April 2000, the firm acquired lubricant and fluid supplier FL Selenia from Fiat for €428 million ($498 million). In September 2003, the business was sold to US private equity firm Vestar Capital Partners for €670 million, delivering a 2.5 times return on cash invested.
Berto said in a statement: “Italy is a core market for Doughty Hanson & Co and we look forward to doing more deals here. I am delighted to be leading our Milan-based team.”
The Italian buyout market came to prominence last year with a number of large deals, including the €5.65 billion buyout of directories business SEAT Pagine Gialle by CVC Capital Partners, Investitori Associati, Permira and BC Partners, and the €1.6 billion acquisition of aerospace firm Fiat Avio by Carlyle Group.
While large deals are still a rarity, the Italian mid-market has been popular with investors for a number of years. Leading private equity firms B&S Private Equity and Investitori Associati have enjoyed recent fundraising success, and newcomer Clessidra Capital achieved a €560 million first closing of its debut fund towards the end of last year.
Doughty Hanson is currently seeking to raise a €3 billion pan-European fund, which posted a first closing at just €700 million in September 2003.
The firm has enjoyed some much-needed exit successes recently. In June, it floated sports clothing retailer Umbro on the London Stock Exchange and sold German auto parts firm ATU to Kohlberg Kravis Roberts for $1.75 billion. Earlier this month, it sold Dunlop Aerospace to Meggitt and Carlyle Group for $1.45 billion.