Advent secures EUR2 billion for fourth fund

10/01/2002 - PrivateEquityOnline.com

European investors have put the lion’s share into Advent International’s new fund, which it will use to focus on buyout and growth company investment opportunities predominantly across Europe.

A rise in European investor interest in private equity over the last year has helped Advent International secure E2bn for its latest fund, Global Private Equity IV (GPE IV).

Fundraising for the fund began at the end of 2000 and Advent has brought in 35 new investor groups taking the total number of investors to around 50. Nineteen of these are European, said Will Schmidt, a managing director at Advent, adding this was a clear indication of the rise in popularity, across the region, of private equity as an asset class.

“Europe is the best place for private equity at the moment. Of all the more mature markets around today, Europe is the only place where private equity is playing a key role in the development and growth of the economy as a whole.

Steve Tadler, managing director at Advent, added: “There is no doubt that the last year and a half has not been easy in the private equity market, so it made sense to look more broadly to attract investors. This was the first time we did so, and our success was down to the appreciation people in Europe have of what we have done in the past.”

European deals Advent has completed in the past include investments from its third fund, which closed in 1997. These included capital commitments to Vinnolit, Jazztel, CyberCity and Trinity Pharmaceuticals. It also invested, together with Clayton Dubilier & Rice, in the carve-out of Italtel from Telecom Italia.

GPE IV has a 70 per cent allocation to Western Europe. The remainder is aimed at North America and Asia. The fund will target buyout opportunities and companies capitalised between E100m and E500m operating across a number of sectors. The firm will focus on business services, chemicals/pharmaceuticals, later stage technology and media, said Schmidt. Two investments have already been made – Materis, a spin out of the French cement giant Lafarge, and Datek, a North American ebroker.

Investors in the fund include Abbey National, British Columbia Investment Management, CalPERS, Canada Pension Plan Investment Board, GE Capital, General Motors Investment Management, NIB Capital Private Equity, Partners Group, Robeco, funds managed by Standard Life, the State of Michigan and the University of Notre Dame.

The closing brings the total funds managed by Advent International to E6.5bn, from which the company has invested in more than 500 companies across 35 countries.