Ecu 1 Billion Pours In To Sixth BC Partners Fund

Phenomenal sums continue to pour in to European buyout funds. BC Partners’ sixth and largest fund closed in October on ecu 1 billion. It took the group, which tends to keep a lower profile than some of its peers in the major buyouts market, less than six months to raise BC European Capital VI (BCEP VI). The fund was heavily oversubscribed, providing further evidence that investor enthusiasm for multi-country buyout funds from established managers shows no signs of abating.

Investors in previous funds committed around 75% of the total. BC Partners, which has a strong historic Continental investor base, raised a “significant proportion” of the fund in Europe and reports that “a very good spread of new Continental investors from the Netherlands, Belgium, France and Switzerland” participated in BCEP VI, along with previous investors from these markets plus Germany, Spain and Italy. Overall, US monies accounted for some 40% of the fund, with capital also raised from sources in the UK and the Middle and Far East.

The new fund is more than twice the size of its predecessor which, at ecu 450 million, was the largest European vehicle raised in 1994, reflecting continuing growth in the size of potential buyout opportunities across Europe. Since its formation eleven years ago, BC Partners’ funds have made 35 investments, in companies with an average value of over GBP100 million. However, the group’s four most recent buyouts – Neopost, Elis, Techem, and Pubmaster – have an average value of around GBP400 million. The two earlier deals done by BCEP V were Nutreco and Interpump.

BC Partners’ latest deals are the acquisition by the fifth fund of a minority stake in the leading French catering group Bercy Management and an in investment in SEAT, the Italian mega-buyout now approaching completion, which will also be made through BCEP V.

The sixth fund, which is targeting deals valued at GBP100 million to GBP1.5 billion (ecu 150 million to ecu 2.2 billion), is expected to acquire 10-15 European companies over the next three to four years. While this portfolio size suggests that the group does not anticipate a further dramatic increase in average deal sizes overall, it is now theoretically in a position to underwrite a GBP1 billion deal at normal levels of gearing, one of only a handful of European houses with this capacity.

BC Partners has led major buyouts in each of the markets where it has offices – France, Italy, Germany and the UK – and as such has played a significant role in increasing the acceptability of a financial bidder to vendors of major Continental businesses. Its active portfolio currently comprises 12 unquoted investments and holdings in three quoted companies: Zucchini, Nutreco and Interpump.