Summit Partners has closed two new funds, a Europe private equity fund with EUR1bn in limited partner interests and its fourth subordinated debt fund with USD825m in LP commitments, bringi
Summit Partners has closed two new funds, a Europe private equity fund with EUR1bn in limited partner interests and its fourth subordinated debt fund with USD825m in LP commitments, bringing its total amount available for investment in growth companies across North America, Europe and Asia to nearly USD6bn.
The launch of Summit’s first dedicated Europe private equity fund reflects the increasing opportunities that the firm sees in working with the management of profitable, growing European companies. The subordinated debt fund will co-invest with Summit’s equity funds, providing a single source of mezzanine and equity financing to meet each company’s financing needs.
The firm will target equity commitments ranging from USD5m to more than USD500m per transaction, with the ability to invest more than USD800m in combined equity and subordinated debt.
Summit opened its London office in 2001 and has since made eight investments in seven European countries, including the acquisitions of Vente-Privee.com, and Welltec International in 2007.
Last year European companies accounted for more than 30 percent of the firm’s invested capital. Summit plans to expand its current team of 15 London-based investment professionals, who will continue to focus on growth equity opportunities throughout Europe.
Since its establishment in 1984, Summit has raised 10 equity funds and four subordinated debt funds with combined assets of more than USD11bn. Summit’s team of more than 80 investment professionals in Boston, Palo Alto, and London take minority and majority positions in companies in sectors including technology, business and financial services, consumer and industrial products, energy, healthcare and life sciences, internet and information services, and media and entertainment.
‘The support we’ve received from both existing and new investors across North America, Europe and Asia has allowed us to raise these funds in just a few months,’ says Summit managing director Martin Mannion. ‘This validates our growth equity investing strategy in exceptional companies.’
Tom Roberts, another managing director, says: ‘The subordinated debt fund allows us to provide companies with a single source of financing for equity and debt financing needs. This gives entrepreneurs access to two-thirds of the capital structure, excluding senior debt, in a single relationship.’
Scott Collins, a managing director in Summit’s London office, adds: ‘We are delighted to close our first European fund. Given our success with investments such as Jamba!, SafeBoot Holdings and Web Reservations International, we aim to grow our European presence significantly in the coming months and years.’
The investors in Summit’s new funds include public and private pension funds, university endowments, financial institutions, corporations, and entrepreneurs previously financed by Summit, with nearly 80 percent of the capital raised coming from investors in previous funds.
Investors in the Europe fund include BP Investment Management, HarbourVest Partners, Irish National Pensions Reserve Fund and LGT Capital Partners, while investors in the subordinated debt fund include California State Teachers’ Retirement System, Minnesota State Board of Investment, Performance Equity Management and Virginia Retirement System.
Since its launch, Summit has provided equity, recapitalisation and management buyout financing to nearly 300 growing companies, almost 125 of which have completed public offerings and more than 110 have been acquired through strategic mergers and sales. Its investments also include E-Tek Dynamics, FleetCor Technologies, Hittite Microwave, Lincare, McAfee, optionsXpress and Physicians Formula.