Since the beginning of the year, the U.S.-based firm has seen three of its four-strong London-based team resign. This follows the decision to discontinue fundraising for both its European and global funds of funds. The firm did not disclose a target amount for either of the vehicles.
Private Advisors has also recently confirmed the resignation of its co-founder Rafael Astruc. According to a brief statement issued to sister Web site peHub.com, the firm “is operating in its usual manner and does not anticipate any disruptions to the business.” The firm is not expected to replace Astruc, which leaves fellow co-founder Lou Moelchert managing the firm.
Private Advisors was set up in 1997 and today manages a total of $3.6 billion in hedge fund and private equity assets, with just over $900 million of that in private equity. The business has 62 employees, including 19 investment professionals based in offices in New York, Richmond and London.
Private Advisors opened its London office in 2008 and hired a team to run the global and European business. Matthew Baker, Jennifer Buckley and Rickard Fischerstrom were hired as managing directors that year, and the team was led by Jens Bisgaard-Frantzen, former CEO and managing partner of Danish pension fund-backed
Beau Hurst, a partner based in the Richmond office responsible for business development and investor relations, told Buyouts that “the decision to discontinue the European investment operation was driven by the economic climate and LP reluctance to commit to private equity given liquidity concerns.” The goal, he said, had been to replicate the firm’s U.S. model in Europe. “We were seeking to launch a European small company buyout fund and a global private equity fund tilted towards the lower mid-market, but given the environment there wasn’t the appetite.”
Hurst said that the firm would continue to build relationships with European LPs, mainly Dutch and U.K. institutional investors, from its London office. “We already have European LPs and are very focused on this side of our business,” Hurst said.
Private Advisors is in the market approximately every two years with a new U.S. fund of funds earmarked for investments in buyout vehicles that acquire small and mid-sized companies based in North America. Fund III closed in 2008 and was capped at $200 million. The firm also has a dedicated co-investment program. With the departure of the majority of the London-based team, Private Advisors will focus on North American fund commitments and will not be making any GP commitments in Europe.
Examples of firms backed by Private Advisors in the North American small-company buyout space (which includes buyouts, distressed/turnaround, and opportunistic strategies) include