In some circles, Schroder is a comic strip character who diligently plays his piano. In Europe, Schroder Private Equity diligently raises funds, and LPs show their admiration by making the firm’s latest fund oversubscribed.
Private equity LPs are a far cry from Peanuts, but they’re enamored enough with Schroder Private Equity Fund-of-Funds II that they invested $340 million.
The fund had an original target of $300 million and held its first closing last October with $130 million. The London-based firm will use the fund-of-funds to invest in about 20 private equity funds, mostly in the United States and Europe.
Schroder Private Equity Fund-of-Funds I closed in 2002 with $288 million. The firm said that this first fund-of-funds has been exceptionally successful and cites its $7 million return from selling its stake in U.K. gardening store Homebase as being a 6x return on its investment. Previous limited partners who participated in the first Schroder fund-of-funds invested more than $190 million to the second fund-of-funds. The firm says its limited partners consist of institutional investors and high-net-worth individuals.
Large European funds-of-funds have enjoyed success in fund-raising this year.
Standard Life Investments, which manages the assets of British insurance giant Standard Life Assurance Co., closed European Strategic Partners II with $1.37 billion earlier this year.
At the same time, moves by smaller players hint at a possible wave of consolidation. Last year, the Germany-based fund-of-funds firm CAM Private Equity took in the fund-of-funds portfolio of the German bank Sal Oppenheim to bring its total under management to $600 million.
Also in 2003, Helsinki-based fund-of-funds firm Proventure merged with a portfolio managed by two other Finnish firms, which brought its total capital under management to $1.2 billion.