French mid-market player, Perfectis Private Equity has closed its debut fund at €80 million. It is over a year since the fund announced its first close at €55 million in October 2000, but the fund has finally managed to exceed its original target of €75 million.
The new venture was founded by veterans of 3i France, Jean-Marie Lavirotte and Gabriel Fossorier, who were both at 3i for 11 years. During their time at 3i, Lavirotte and Fossorier invested three funds completing 43 deals and achieving a 25.7 per cent IRR for 1990 to 2000. The five-strong team also comprises Delphine Dufour, Stéphane Bergez and Laurent Vallée. Dufour and Bergez also have history at 3i.
The fund will focus on mid-market MBOs, MBIs and growth capital deals. According to Lavirotte, the current climate is very favourable in the French middle market buyout segment. There is significant deal flow due to family succession issues and company restructuring for buyouts or build-ups in consolidating sectors and competition is less intense than in the large buyout segment. The fund will invest in around 12 to 15 companies with an average investment size of between €15 million and €100 million.
For a spin-out fund and in spite of the challenging fundraising environment, Perfectis I has attracted a broad range of institutional investors, including fund-of-funds from France, Switzerland, Germany, UK and the US. Around half of the investors in the fund come from outside France. EULER-SFAC, a French leader in the credit risk insurance industry is sponsor and anchor investor in the fund. Further investors include Swiss Re, Groupe Crédit Agricole, Partner Re, CNP and Duke Street Capital. Acanthus Advisers, represented by Armando D’Amico and Michel Delouvrier acted as placement agent for the fund in the final part of the fundraising. The fund is structured as a classic French FCPR comprising a 2 per cent management fee and a 20 per cent carry subject to a 6 per cent hurdle.
Perfectis has already committed to four transactions – the buy-and-build of All Fresh Logistique, a food service distributor; Cameca, a manufacturer of instruments for surface and interactive micro-analysis; MS Relais, a maker of electromechanical switches for the railway industry; and aluminium specialist, Aluthea.