Foresight closes latest regional private equity fund

Foresight Group, a listed infrastructure and private equity investment manager, announces the first close of the Foresight Regional Investment III LP at GBP65 million. The Fund is cornerstoned by the Greater Manchester Pension Fund, with strong support from Clwyd and Merseyside Pension Funds.

The fundraise comes off the back of the Foresight Regional Investment LP’s (FRIF) success in the North West, a fund which exemplifies the strength of Foresight’s regional private equity strategy, addressing the gap for impact-focused equity investments in growing SMEs typically valued at up to GBP30 million.

The strategy delivers both attractive economic returns and broader long‐term benefits for regional communities by applying a professional approach to private equity investment in this underserved and less competitive part of the market. The first fund, FRIF, has helped create more than 600 new jobs in growing SMEs with the first two exits returning 6.1x and 5.6x money respectively.

In line with FRIF, the Fund has a flexible mandate and can deliver buyout, minority equity release and growth capital transactions. Foresight currently manages five regionally focused investment funds, notably raising the GBP100 million Foresight East of England Fund (Foresight Regional Investment II LP) in 2019, which applies this same strategy in the East of England, through an evergreen structure.

The Fund will be managed by Foresight’s collegiate nationwide private equity team, with growth in Foresight’s Manchester office planned to support the deployment of the Fund. Over the last five years, Foresight has established itself as a key player in the local market. The predecessor fund has invested in more than 20 local companies, working closely with management in each case to support their growth plans. However, the region remains underinvested and Covid-19 has materially widened the equity gap and only increased the opportunity for the Fund to have a strong positive impact on the local community.

The Fund will provide the platform from which Foresight can provide both capital investment and expertise to support development of sustainable, socially conscious small businesses in the region.

James Livingston, Partner at Foresight, says: “We are delighted to be welcoming both new and returning investors to the Fund, which will continue to address the gap in the market we have demonstrated with its predecessor fund. We look forward to supporting the growth of smaller companies across the targeted region.”

Claire Alvarez, Director at Foresight, adds: “Over the last five years, we have worked closely with the local community to invest in a range of companies, backing excellent teams and their sustainable growth plans. The impact of our activities on the local market is clear and we look forward to continuing this success with this Fund.”

Osborne Clarke acted as legal counsel to Foresight Group LLP.