Schroders and SVG Advisers have closed the Schroder Private Equity Fund of Funds III (SPEFOFIII) at EUR167 million. The fund is advised by SVG Advisers Limited, the fund management business of SVG Capital, the FTSE 250 private equity investor.
The fund will predominantly invest in top performing private equity partnerships in Europe and the US. The portfolio will consist of approximately 20 private equity funds selected to provide an ttractive return and diversification, with a focus on later stage/buy-out funds. Commitments have already been made to three funds totalling more than EUR65 million.
SPEFOFIII has been structured to meet the requirements of both small and large institutions, and high net worth individuals, and will be listed on the Irish Stock Exchange. Its innovative structure offers investors the choice of three separate share classes with differential pricing, allowing for a minimum investment of EUR125,000, payable in four instalments.
SPEFOFIII has received commitments from a diverse group of investors, both in terms of geography and type, including UK pension schemes. Investors in the first and second fund of funds have continued their support by investing in SPEFOFIII. The second Schroder Private Equity Fund of Funds raised EUR285 million in 2004 and it is expected that SPEFOF III will have a final closing in March 2006 targeting a similar amount. The first fund of funds raised EUR242 million in 2002. “Investment in private equity fund of funds is an attractive way to achieve long-term capital growth,” says Richard Mountford, Head of UK Distribution, Schroders. “It has the added benefit of reducing investor’s portfolio risk through diversification. If investors want diversified returns, they should consider private equity.Schroders sees attractive investment opportunities in the European and US private equity markets and believes that SPEFOFIII is well placed to build on the good performance of its predecessors.”
Andrew Williams, Chief Executive, SVG Advisers, says it was a triumph to secure commitments of EUR167 million so quickly after the launch. “It is a testament to the performance of the first two fund of funds and the investment process of the team,” he says. “This is a highly flexible private equity fund of funds product which we believe will satisfy a growing demand among investors for alternative investments.”