TDR races to first close on Fund IV – Exclusive

The mid-market firm has attracted demand in excess of €5bn for its latest offering.

London-based mid-market firm TDR Capital is set to hold a first close on its latest buyout fund with commitments of more than €2 billion, Private Equity International has learned.

TDR Capital IV, which officially launched at the firm’s investor conference at the end of September, has already attracted demand in excess of €5 billion, and some investors may not get the commitments they have requested. The hard-cap has been set at €2.85 billion.

Sources familiar with the matter told PEI that the firm will hold the first close in the second week of December. Some investors are waiting until the new year to finalise their commitments, which will come from 2017’s allocation.

TDR declined to comment.

TDR’s previous fund, a 2013-vintage, closed on €2.1 billion. Investors in that vehicle include Oregon Public Employees’ Retirement System, PGGM and Abu Dhabi Investment Authority, according to PEI Data.

Historically TDR has made a GP commitment to its funds of around 10 percent, and is usually the largest single investor in its funds. Its vehicles typically invest in between eight and 10 businesses.

TDR investors have co-invested alongside the fund on several transactions in the past, and it is understood there is scope for co-investment alongside the new vehicle.

Fund III investments include fleet management and driver mobility company LeasePlan, European health club operator David Lloyd Leisure, and fuel marketing and convenience retail group EFR Group, which recently merged with Euro Garages to create a business with annual revenues of around €6 billion.

It is understood that some capital remains in Fund III for follow-on investments.

Earlier this year TDR raised €835 million for an “annex” fund, which will be used to make follow-on investment for the four remaining portfolio companies in the €2.2 billion TDR Capital II, a 2007-vintage fund.

Around half of the capital for the side vehicle came from Landmark Partners, with the rest from TDR’s existing investors and Landmark co-investors.