German Mittelstand fund launched

German mid-market finance house Buchanan Capital Group has launched a new fund aimed at investing in family-owned businesses in German speaking companies in Europe. The fund, called Buchanan Unternehmer-Fonds, will be managed by Buchanan Capital Partners aims to reach around €40m on first closing in mid 2006, with a final closing target of €150m. It is open to investment from private individuals, with a minimum contribution of €500,000, and institutional investors, who must commit no less than €2.5m.

The life of the fund is slightly longer than typical at 12 years, with the average holding period expected to be up to eight years. Partner Peter Blumenwitz says: “For the Buchanan Unternehmer-Fonds, we have developed a longer-term holding concept to provide family-owned companies with significant growth capital. In partnership with the owners and the management, we will look after the further development of the company, regardless of whether we acquire a majority or minority share.”

Blumenwitz is one of three partners at the firm, and was previously at Apax. Also on the team are Frank Henkelmann, formerly of General Atlantic Partners, and Herbert Seggewiß, formerly 3i Germany. They are joined by director and ex-Roland Beger employee Marc-Steffen Hennerkes. The partners and the two founders of parent company Buchanan Capital Group are personally investing a total of €5m.