Advent breaks fund record

Buyouts player Advent International has closed is sixth private equity fund on €6.6bn to invest globally.

The largest mid-market buyout ever raised, GPE VI, will continue Advent’s strategy of investing in mid-market and upper-mid-market companies, defined as businesses with enterprise values between €200m and €1bn, in Europe and North America. The fund is expected to make between 30 and 35 investments.

The fund reached its hard cap after exceeding its original target by over 30%, and with over €10bn of interest from investors. Fund raising leader and Advent managing director Bruce Barclay, said: “This has been achieved despite the debt market turmoil and stock market declines, which have concerned some investors and slowed a number of other fund raisings. We were able to have effectively a first and final close on March 12 and then waited a few weeks primarily for some investors who have new fiscal years beginning in April.”

Advent’s latest vehicle collected investment from 160 investors, with two-thirds of the capital raised coming from existing investors. North American institutions provided 42% of the money raised and their European equivalents contributed 41%, with 11% coming from Asia Pacific and 6% from the Middle East.

The eight largest investors by committed capital are Canada Pension Plan Investment

Board, GIC Special Investments, AlpInvest Partners, Pantheon, California State Teachers’ Retirement System, SL Capital Partners LLP (formerly Standard Life Investments Private Equity Ltd), Universities Superannuation Scheme and Partners Group.

A team of 69 investment practitioners in Western Europe and North America have been charged with putting the €6.6bn to work, and almost 50 additional personnel in Central and Eastern Europe, Latin America and Japan will provide support.

As per the €2.5bn GPE V, Advent’s newest offering with concentrate on three types of investments: international buyouts, strategic restructuring opportunities and growth buyouts. The firm’s preferred sectors remain business and financial services; retail, consumer and leisure; healthcare; technology, media and telecoms; and industrial.

Steve Tadler, chairman of Advent’s executive committee, said: “Our strategy of concentrating on fundamentals and earnings growth in portfolio companies has proven itself across many economic and financial cycles for over two decades, as well as in multiple geographies and sectors, and our investors recognise that. We are not, and never have been, heavily reliant on financial arbitrage to generate returns, which is clearly important to investors in the current turbulent environment.”