F&C Holds First Close Of Private Equity Fund Of Funds

Mar 30 2007 | 11:22am ET

Asset management firm F&C Investments recently held a first close on its new private equity fund of funds, F&C European Capital Partners, at €112 million (US$150 million). The new offering is expected to hold a final close later this year with total commitments in excess of €200 million. Initial investors in the fund have come mainly from the U.K. and the Netherlands, according to the firm.

The fund, which has a European middle-market focus, will have a portfolio of upwards of 20 leveraged buyout and mezzanine funds. It will also co-invest up to 30% directly, mainly in deals led by European private equity firms known to F&C.

“Through F&C European Capital Partners LP we will access a wide range of opportunities via a number of locally based experts and others who operate on a pan European basis,” Hamish Mair, head of private equity funds at F&C, said. “We will also be backing several emerging manager groups. We have found that the alignment of interest between private equity managers and investors is especially strong with emerging groups.”

The offering sports a feeder-fund that invests in listed private equity vehicles providing investors with immediate exposure to the private equity market, according to the firm. As the underlying fund and co-investment portfolio build up, the listed portfolio will be gradually sold down.

“This structure has proved popular with investors who find the multiple draw downs of a conventional LP structure cumbersome,” the firm stated, adding that the fund can also enhance returns through the selective use of leverage with the ability to gear up to 30% of total portfolio value.

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