Arx Equity Partners has held the first close of its third dedicated Central and Eastern Europe-focused lower mid-market fund at EUR83mm and is targeting EUR125m for the fund’s final close.
Arx Equity Partners has held the first close of its third dedicated Central and Eastern Europe-focused lower mid-market fund at EUR83mm and is targeting EUR125m for the fund’s final close.
Arx III’s largest first close commitments came from the European Bank for Reconstruction and Development, the European Investment Fund and Alpha CEE II, a fund managed by Alpha Associates).
The launch of the fund as successor to DBG Eastern Europe II follows the rebranding of DBG Eastern Europe as Arx when the firm became fully independent from Deutsche Bank earlier this year.
The team of eight professionals is led by co-managing partners Jacek Korpala and Brian Wardrop (photo). ‘Arx III represents a continuation of the strategy we have pursued over the past several years with DBG II, and our geographic focus and investment style are well-suited for the current market environment,’ Korpala says.
Wardrop adds: ‘Succession-driven deal flow in the Central and Eastern Europe region is increasing for several fundamental reasons, and Arx is ideally positioned to capitalise on these opportunities.’ The fund will target equity investments of EUR3 to EUR15m per transaction.
At the beginning of September, Arx completed an exit from its investment in Donit Tesnit in Slovenia, realising a threefold cash-on-cash return and an internal rate of return of 58 per cent. Toward the end of the month, the firm completed the concurrent acquisitions of two complementary businesses in the Czech Republic, Lanex and Singing Rock, in a succession-driven buyout.
Arx, which operates from offices in Bucharest, Budapest, Prague and Warsaw, focuses on later-stage investments such as management buyouts and buy-ins, industry consolidation transactions and later-stage expansion situations.
