Bain Capital raises US$5.5bn European buyout fund

Bain Capital’s third European buyout fund has closed on €3.5bn tripling the €1bn it raised in 2004 for its second fund, and the €750m it raised in 2000.

The fundraising places it firmly ahead of other upper-mid-market pan-European buyout players, but not in the same league as the mega-buyout houses. CVC is currently in the market with its fifth dedicated European fund, targeting €12.1bn, while Apax is expected to announce the close of a €11bn vehicle shortly.

However, the €3.5bn raised by Bain gives it substantially greater firepower than mid-market players such as Industri Kapital, which closed a €1.675bn fund in 2007, and Barclays Private Equity’s €2.4bn latest fund, also closed in 2007.

A look at Bain’s past activity suggests it is likely to continue to focus on mega-deals despite the smaller size of its fund compared to big buyout groups. In 2007, Bain paid €1.6bn for UK catering supplier Brakes. Its bidding interest has consistently weighed in at the €1bn+ mark – earlier this year it was outbid by a BC Partners-led consortium for Turkish retailer Migros which was sold for US$1.6bn, and in 2006, it made a play for Dutch postal business TNT which was eventually acquired by Apollo Management for US$1.48bn.