Kenmore launches mid-market PE

Property investor Kenmore has launched a new mid-market business, Kenmore Private Equity (KPE), headed by Simon Dempsey, formerly a regional director at Lloyds TSB Development Capital (LDC), the private equity arm of Lloyds TSB bank.

KPE is the sister business of Kenmore Property Group, an international real estate business which manages a portfolio of over £1bn of commercial property.

Dempsey said that Kenmore approached him after he left LDC in March with a mandate to set up a private equity business sourcing mid-market deals across a range of sectors: “We have a very flat structure, so it’s about rapid decision making and plugging into the network of offices in the UK and overseas. We will focus principally on the UK, continental Europe and the Middle East.”

KPE will typically invest in sub-£50m transactions, although Dempsey noted there is “no minimum as such and we will consider deals of most sizes”. He added that amongst the firm’s current pipeline of deals were a facilities management business, a branded leisurewear company, a sales and distribution firm within the leisure market, as well as renewable energy investments.

“We will also invest in some early-stage assets as well, although we will probably do that through investing in other people’s funds,” said Dempsey. “There are no embargoes, though – the common denominator will be high quality management.”

The firm will invest mainly from Kenmore’s balance sheet and some of its property group’s funds. “It will be a mixture,” said Dempsey, “including some direct investing, using people who have previously backed us on a deal-by-deal basis and where there is an appetite for it. If we need to, we will raise a fund later but it is not in our plans at the moment.”

Kenmore has offices in Stockholm, Oslo, Dubai, London, Manchester, Birmingham, Edinburgh and Bristol, with a new site launching in Leeds in the New Year. Although the offices have principally been used for property investments, Dempsey said that KPE will look to build a private equity team and “use the real estate business as a deal radar. We have people already who are doing deals with private equity characteristics, including in-house lawyers. They have found with numerous property investments that there are opportunities to buy the business as well.”