– Demand stretches Carlyle’s Internet fund to 730 million

The Carlyle Group, which recently flagged 650 million ($600 million) or thereabouts as the upper limit for its European Internet fund, in mid-April announced a final close on 730 million. The original target for the fund, launched last October, was a modest 300 million.

At the same time as the closing, Carlyle announced the appointment of Jacques Garaalde as Carlyle Internet Partners Europe’s third managing director, to work alongside Jean-Bernard Tellio, formerly of LVMH/Groupe Arnault, and Tim Jackson, founder of QXL.com. Garaalde joins Carlyle after 18 years with Boston Consulting Group, five of them as managing partner of the group’s Paris and Brussels offices.

The new Carlyle fund currently ranks as the largest conventional private equity fund of its kind in Europe and is among the largest pools of capital targeting European Internet, IT and new media companies. David Rubenstein, a founding managing director of Carlyle, describes Carlyle Internet Partners Europe as a key component of our global strategy to be among the leading Internet investors in every given market’.

Managing director Tim Jackson acknowledges that size is not everything, but points out: “It is because of strong investor demand that we have increased the scale of our operation. Lots of other people have announced plans to raise big funds. This one is real, not vapourware”.

Carlyle declines to disclose the identities of Internet Partners Europe’s investors, but Jacques Garaalde reveals that capital from non-US sources, principally European, constitutes the majority of the fund and adds that a significant share’ of the LPs were already investors in other Carlyle Group vehicles. Participants include corporate venture funds, pension funds, banks and high net worth individuals from Europe, the US, Asia and the Middle East. Garaalde also indicates that Carlyle Internet Partners Europe is due to complete an important investment during May.

Carlyle Internet Partners Europe will invest across all areas of the Internet value chain’ – network infrastructure, e-commerce and business-to-business companies. It will also target opportunities arising from the impact of business-to-business e-commerce on traditional companies, an area where Jacques Garaalde has specific strategic insight, according to Jean-Bernard Tellio.