Italian mid-market attracts funds

Milan-based Cape Natixis is celebrating the first and final close of Cape Natixis Due at €195m, exceeding its original target of €160m. The fund, which invited only selected investors, was oversubscribed. Natixis Private Equity is a cornerstone investor in the fund. Acanthus Advisers acted as exclusive financial advisor and international placement agent.

Investments will be made in small and mid-cap buyouts in the North of Italy, mainly in the regions of Lombardia, Veneto and Emilia Romagna. The team is looking for buyout or build-up situations from companies with family succession issues and in consolidating sectors with an enterprise value of around €20m.

An unusual remit of the fund is that a small portion of the capital will be used to target selective investments in China. The reason for this is in the past five years several trading and production facilities have been set up in China on behalf of the group’s portfolio companies. The Cape China team currently consists of three professionals, providing Cape with a permanent presence and established network.

Cape Natixis Due is the fifth pool of capital advised by the team at Cape (Cimino Associati Private Equity) since its inception in 1999. The firm was founded by Simone Cimino, chairman, in 1999 and has been co-managed since 2002 with Marco Vismara, CEO and Guido de Vecchi, managing partner. The team have completed 35 transactions since inception with a realised IRR of 64% and multiple of 3.5x.

Cape sources proprietary deals through its own relationships (typically local lawyers, accountants and entrepreneurs in the North Eastern region of Italy). This tends to be on an exclusive basis, limiting the firm’s involvement in competitive processes.

Landmark deals for the firm include Trevisan, a manufacturer of powder coatings which Cape acquired in 1999 and refinanced in 2002, realising an IRR of 105% and a multiple of 6.6x and Arkimedica, which was created by Cape from CLA, a producer of hospital beds and furniture. After a series of expansions, the business now consists of four divisions and an IPO in 2006 led to Cape realising 30% of their investment and the business reaching a market capitalisation of over €200m.