Advent International has announced the final close of its most recent global private equity fund, Advent International GPE V, at $3.3 billion (euro 2.5 billion). With more than $5 billion of interest from investors, the fund brings the total cumulative capital raised by Advent to $10 billion.
The GPE V strategy focused on three specific investment scenarios, according to Advent. These strategies were: categorized as international expansion (companies operating or seeking to expand internationally); strategic restructuring (companies enhancing earnings by refocusing on core competencies); and high-growth sub-sectors (companies exploiting organic market growth or new product/service models).
Like its predecessor funds, GPE V will invest primarily in Europe and North America. While continuing to focus on investments with a typical enterprise value of $50 million to $500 million, the new fund also provides the flexibility to sole underwrite deals of up to $1 billion enterprise value. Target sectors remain Business & Financial Services, Technology, Media & Telecoms (TMT), Retail & Consumer, Healthcare & Life Sciences, and Industrial.
A total of 86 investors participated in GPE V. The fund received strong support from existing limited partners, whose total commitments exceeded the original target capitalization. New investors committed the additional capital to reach the hard cap of $3.3 billion. Eight of the largest investors in the fund are GIC Special Investments, Canada Pension Plan Investment Board, AlpInvest Partners NV, State of Michigan Retirement Systems, funds managed by Standard Life, Pantheon clients, Partners Group-advised clients and California Public Employees’ Retirement System. The fund saw an increase in interest from European institutional investors who contributed 38% of the capital raised. Forty-six percent was raised from North American investors and 16% from Asia and the Middle East.
Will Schmidt, managing director at Advent International in London, said, “We believe that the great investor interest in GPE V results from our highly differentiated strategy for identifying and developing mid-market buyout opportunities relative to the industry’s historically more financially-driven models. We hope that the new fund will repeat the strong performance of its predecessors by building a portfolio of companies with high potential for accelerated growth and earnings enhancement.”
David Mussafer, Managing Director at Advent International in Boston, said: “For the first 10 years we were in business, U.S. private equity firms didn’t seem to care much about deals in Europe. Now that has all changed as many of the more successful investment groups have sought to build a presence in Europe in the past few years. For us, however, this has been the driving force of our business model since we launched Advent more than two decades ago. Most of the companies we see today have significant international operations or aspirations, which gives us an important edge due to our global platform.”