Spanish fund raising boomed in 2000, over three times the amount raised in 1999, according to Spanish corporate finance newsletter, Capital & Corporate. Total Spanish funds raised in 2000 reached EURO1.8 billion. Taking into account pan-European funds, which dedicate part of their fund to the Spanish market, this figure reached EURO2.5 billion in 2000.
The surge in the Spanish market is largely due to an economy that is flourishing; the new regulation regarding private equity funds, with more attractive tax incentives; and the launch of new funds with banks for sponsors such as Banco Sabadell and Banco Pastor for Aurica XXI and Banco Guipuzcoano for Diana Capital.
Figures from the Spanish venture capital association, ASCRI, reveal that total managed funds in Spain increased to EURO4.75 billion, up 91.5 per cent compared to 1999. Boosting this figure was Spanish private equity firm Mercapital Servicios Financieros’ second fund SPEFII, which closed earlier this year on EURO600 million, the largest private equity fund in Spain to date (see evcj February p 27). Mercapital accounted for 40 per cent of the generalist funds raised for investment in capital development and buyouts in Spain in 2000.
High tech funds accounted for 20 per cent to 25 per cent of the new funds raised. Funds launched last year dedicated to this sector included Innova Capital with EURO120 million, Marco Polo with EURO97 million, and TecPlus, Granville Baird’s Spanish fund, with EURO30 million.
The high tech sector also put in an impressive performance in terms of deals in 2000, the most significant including a EURO63.8 million investment in Netjuice by 3i, GE Equity, Fibanc
and FCC; 3i’s EURO40 million commitment to Sistemas Informaticos Abiertos and a EURO36 million investment by Vista Capital in Grupo SP. Many commitments have been made as a co-investment and for the first time a significant number of foreign funds without a Spanish presence have participated in rounds such as Z Capital Partners, GE Equity, Palamon, Atlas Ventures, Pino Ventures and NetPartners.
Total amount invested in 2000 reached EURO1.1 billion, up 55.9 per cent on the previous year and the number of deals also rose to around 258 companies, an increase on the average of about 100 per year throughout the 1990s, according to ASCRI. There was an increased focus on investments dedicated to early stage, which accounted for almost 18 per cent of total amount invested, compared to 6.2 per cent in 1996.
Total value of divestments was up 11.6 per cent, reaching a total of EURO217 million, while the number of exits at 107 fell for the fourth year running. Most of the exits were from commitments that were made during the first half of the 1990s.