Compass Europe Fund Approaches Close

Compass Partners International by mid-autumn was more than two thirds of the way to its $1 billion (ecu 835 million) target for its debut European fund.

The group, which opened a London office earlier this year and also has a base in New York, began marketing Compass Partners European Equity Fund in the first half of 1997, reaching a $400 million first close this spring. A series of rolling closes have since boosted the vehicle past the $700 million mark, and Compass reportedly plans to close the protracted marketing effort before the end of the year.

In the context of unprecedented levels of liquidity in the private equity fund-raising market, Compass might have expected an earlier wrap for the vehicle. At the time of its launch, however, Compass European Private Equity Partners was a debut fund competing with several established European private equity managers marketing pan-European vehicles of a similar magnitude.

Compass’s founding partners are Stephen Walters, formerly head of European M&A at Morgan Stanley; John Clark, formerly chief executive of BET; and Paul Soldatos, who was previously a partner at Investcorp. They were recently joined by Bolaji Odunsi, previously a partner of BC Partners.

The Compass fund’s strategy hinges on the combination of operational, M&A and private equity experience provided by its partners. The principals believe they are well positioned to identify suitable opportunities for private equity investment from the operational, as well as the financial perspective. The group will target complex multi-national transactions, with a particular focus on “corporate orphan” businesses in need of restructuring or turnaround. Compass will normally take controlling positions in investees and will invest throughout Western Europe across a broad range of industry sectors.

Compass plans to establish alliances with Compass Partners European Equity Fund LPs in its principal target markets, a strategy designed to enhance Compass’s deal sourcing network. The group’s strategic advisory activities are also expected to generate proprietary deal flow.