Ardian, one of Europe’s biggest private-equity firms, has wrapped up fundraising for its largest-ever buyout vehicle and plans to invest the roughly €7.5bn (about $8.9bn) with a trans-Atlantic flair.
The Paris firm raised €6.5bn for its Ardian Buyout Fund VII and an additional €1bn for co-investment alongside deals made from the vehicle through side agreements with some of the largest investors in the fund, according to Thibault Basquin, head of Americas investments for Ardian’s buyout strategy.
The new fund is roughly 60% bigger than the €4bn the firm raised in 2016 for its predecessor, Ardian LBO Fund VI, which was accompanied by €500 million in side agreements for co-investments.
While Ardian plans to focus investments from the fund on Western European businesses with enterprise values of as much as €2bn, it is also putting an emphasis on trans-Atlantic deals, Basquin said. For example, it can back North American companies looking to expand in Europe or Asia, as well as European companies aiming to develop a US presence. The strategy focuses mainly on healthcare, food value chain, technology and services businesses.
“We are differentiating ourselves in the US by leveraging our European network,” Basquin said about the firm’s investment approach, adding that it brings an established network of European financial and business support services to the table.
Ardian has already done 11 deals from the fund, which it began raising in 2019, Basquin said. In November, the firm acquired a 50% stake in Angus Chemical from Golden Gate Capital, which retained the other half in a deal that valued the Buffalo Grove, Ill.-based manufacturer at about $2.25bn.
In another deal, Ardian backed French baked goods manufacturer Cérélia in late 2019 and has helped the company expand in North America, most recently by acquiring US Waffle, a producer of pancakes and waffles based in Liberty, SC, last month.
Basquin said that Cérélia’s trans-Atlantic expansion is a good example of the types of deals sought by the buyout strategy. So far, he said, about two-thirds of the value creation in the company has come from North America.
By March 2020, just as the coronavirus pandemic took hold, Ardian had received about $5bn in commitments for the new buyout fund, Basquin said. The firm raised the rest even as buyout strategies globally experienced a sharp decline in fundraising, according to data from Preqin.
Buyout funds brought in 29% less cash globally last year, raising $275.74bn compared with $388.51bn in 2019, according to preliminary Preqin data back in January. But among Europe-focused funds pursuing all types of private-equity strategies, capital raised jumped 30% to $141.6bn, the data show.
The New Jersey Division of Investment, which manages public pension money, backed the firm’s latest buyout fund, committing about $147m in March 2020, a public document shows. About $36.2m has been invested and had returned about 1.16 times its value by the end of last year, the record shows.
Ardian, which established a US beachhead for its control buyouts team in New York in 2019, has recently added to the team in Europe and it now numbers 52 investment professionals. Recent hires include Scarlett Omar Broca in France and Heiko Geissler in Germany.
The firm began as a unit of French insurer AXA SA in 1996 but was carved out in 2013 and has grown to manage or advise more than $110bn of assets, up 34% from around $82bn just two years ago. Last year, it collected $19bn for its secondary strategy, one of the largest private-equity funds raised anywhere in 2020.
Write to Ted Bunker at [email protected]
This article was published by Dow Jones NEWSPLUS