Unigestion raises €300m with Union Investment

The DZ Bank investment arm will hand management of a fund of funds vehicle to the Swiss firm for the third time.

Union Investment, the investment management arm of Germany's DZ Bank, has raised more than €300 million for its PE-Invest 3 fund, according to a statement released by Unigestion, the investment manager that will manage the fund.

PE-Invest 3, which will invest globally in private equity funds as well as secondaries and direct investments, was raised in three months.

The fund is specifically targeting funds that specialise in small and mid-market US and European firms, as well as Asian corporates, venture capital and turnarounds. It will invest in between 15 and 20 funds, which in turn will hold around 300 company stakes, the statement said.

Up to 25 percent can be allocated to secondaries and 20 percent to direct investments, according to a spokesperson for Unigestion. The fund has a 12-year investment horizon, plus the option to extend by two one-year periods. The average lock-up period is seven to eight years.

This is third such collaboration between Union Investment and Unigestion, which have both committed to the fund.

The €357-million PE-Invest 1 launched in 2005. According to a Unigestion marketing document, as of 31 December it was invested in 52 funds through which it held unrealised stakes in 410 target companies. The pure private equity stake has achieved net internal rate of return of 9.6 percent, the document says. The €233.1 million PE-Invest 2 is invested in 400 target companies via 35 separate funds. It has achieved IRR of 10.3 percent as of 31 December.

PE-Invest 3 will be run by Unigestion senior vice-president Kay Olschewski, who manages a number of $1 billion-plus primary, secondaries and direct investment funds, according to his LinkedIn profile. He is also responsible for sourcing, analysing and executing direct secondaries and fund restructurings.