European private equity firm Cinven has exceeded its target and held a final close for its fifth European buyout fund at EUR5.3bn.
This follows a close in March 2013 at EUR5bn.
The fund remains the largest pool of capital currently dedicated exclusively for European buyouts. It has already made investments in three businesses – two business services companies, Pronet and Prezioso, based in Turkey and France, respectively; and UK-based healthcare business, AMCo.
In addition, Cinven’s Fourth Fund has completed the IPO and partial realisation of Partnership Assurance Group, a provider of non-standard annuities, which offers better terms to customers with medical conditions. Following its admission to the London Stock Exchange on 12 June, Partnership will have generated gross proceeds of EUR343m for investors and a total return of more than 8x including Cinven’s remaining shareholding in the company.
Cinven made its original investment in Partnership in 2008 and retains a 52 per cent shareholding in the Company post-IPO (following the exercise of the over-allotment option). Based on yesterday’s closing price of 450p (up 17 per cent on the IPO price of 385p), the Fourth Fund’s residual stake is valued at EUR1.1bn.
Cinven’s other financial services investments include Avolon, the aircraft leasing business, and Guardian, the consolidator of closed life assurance books.
Cinven Funds have realised more than EUR6bn of value for investors since the start of 2011 including the proceeds realised from the Partnership IPO following its admission to the London Stock Exchange, and the realised value from the disposal of Avio’s aviation unit to GE at the end of 2012.
Alexandra Hess, partner of Cinven Partners with responsibility for fundraising and IR, says: “The final closing of our Fifth Fund reflects the confidence our investors have in Cinven’s ability to capitalise on our sector insights and invest this fund in European-centric businesses. Having raised EUR5.3bn, which is ahead of our target, we believe Fund 5 is right-sized for the investment opportunities we currently see across Europe. We remain focused on investing in European-centric companies with strong growth potential that we can accelerate either globally or in their domestic markets.”
Hugh Langmuir (pictured), managing partner of Cinven Partners, says: “The success of Partnership underscores Cinven’s financial services team’s expertise in successfully investing in what is a complex and regulated sector. As a result, we are well positioned to target further investment opportunities in the sector for Fund 5. We are also continuing to see highly attractive investment opportunities across our other core sectors.”
