BaltCap has reached the first close on its latest fund, BaltCap Private Equity Fund II (BPEF II), at EUR50.6m and has subscribed commitments of EUR63m from investors already.
BPEF II, which has a target of EUR100m, has achieved support from limited partners including the European Investment Fund (EIF) investing through Baltic Innovation Fund (a fund-of-fund initiative between EIF and the governments of Estonia, Latvia and Lithuania), the European Bank for Reconstruction & Development (EBRD) and Baltic pension funds managed by Swedbank Investment Funds, LHV Asset Management and Danske Capital.
BPEF II will continue the strategy employed by BaltCap Private Equity Fund I that has completed eight investments which during the last four years have on aggregated basis more than doubled their revenues, reaching EUR230m in 2013, and quadrupled EBITDAs. Several companies have carried out significant international expansion and the number of employees across the portfolio has grown by half to 2,700 during BaltCap’s tenure.
BPEF II will make equity investments in innovative companies based in the Baltic region, focusing on buy-and-build opportunities that offer the potential for BaltCap to capitalise upon the unique Baltic market opportunity. BPEF II will seek to acquire controlling ownership stakes, typically investing between EUR5m and EUR10m per portfolio company. BaltCap will act as an active medium term investor partnering with management teams in order to build market leading companies in their respective sectors.
Peeter Saks, managing partner of BaltCap, says: “We are extremely happy about the strong support from our cornerstone investors EIF, EBRD and the local pension funds, in launching BPEF II. The favourable economic environment in the Baltic countries coupled with fragmented markets featuring a large number of SMEs across different sectors, provide excellent opportunity to build regional leaders through cross-border growth and acquisitions.”
Richard Pelly, chief executive of the European Investment Fund, says: “Our new commitment to BaltCap further strengthens the relationship we have been building together since 2001. BaltCap’s record and proven capabilities of investing in this region are unmatched and this new fund will extend their reach further. The European Investment Fund is both the architect and key investor in the Baltic Innovation Fund alongside our partners from the region. BPEF II is the first fund launched under Baltic Innovation Fund and represents a significant milestone in the implementation of this unique pan-Baltic fund of funds activity.”
