ZURICH, Switzerland – Advisers on Private Equity AG closed its fifth deal in June, two months after a euro100 million ($103.52 million) final close on its second fund-of-funds, Private Equity European Partners C.V. (PEEUP).
Advisers Managing Director Bruno Raschle said the fund-of-funds invested an undisclosed amount with London-based buyout group Duke Street Capital. Mr. Raschle would not disclose the names of the other partnerships, but he acknowledged that four were European funds and one was based in Hong Kong.
PEEUP, which will back buyout and venture capital partnerships in Europe, Eastern Europe, Asia and Latin America, will invest as much as 20% of the fund in VC partnerships.
The fund is hitting its stride just as the firm is beginning to wind down its first vehicle, the $66 million Private Equity Technology Partners C.V. (PETP). Launched in the summer of 1997, PETP invests primarily in United States-based technology-focused vehicles and has made 12 commitments by press time, including Sequoia Capital, Morgenthaler Ventures, Delphi Ventures, Accel Partners, New Enterprise Associates, Patricof & Co. Ventures Inc., Forward Ventures and Ampersand Ventures.
Mr. Raschle said he believes the impact of information technology companies will be felt in the U.S. and European buyout communities.
“Many of these IT companies can make whole distribution levels obsolete almost overnight,” he explained, pointing to how young companies such as online bookseller Amazon.com Inc. and online toy retailer E*Toys Inc. have affected their industries. “In Europe, buyout financing has really focused on mature industries,” he explained. “The selection criteria is different; the executive management attitudes are different.”
PETP, which will make a total of 15 to 17 investments, was close to completing three more commitments at press time, Mr. Raschle said, adding that the firm likely will launch a second technology fund late in the year. PEEUP and PETP are largely backed by the same limited partners, composed of an even mix of pensions, financial institutions and individual investors, primarily from German-speaking countries, Mr. Raschle said.
Advisers on Private Equity is managed by Mr. Raschle and Andre Jaeggi, who joined the firm in June 1998 (VCJ, June 1998, page 29). Mr. Jeggi was previously a managing director of Prevista Anlagestiftung, one of Switzerland’s largest pensions, and a limited partner in PETP. Advisers has hired but not disclosed the name of a third partner, who will join the team this summer, and at press time was searching for a senior associate.