Bridgepoint Capital To Hit €4bn Goal

Mid-market private equity firm, Bridgepoint Capital, are to confirm new investors that will have them hit their prescribed fund raising goal of €4bn (£3.1bn, $6.2bn).

New trends within the sector suggest that investors are feeling more comfortable with smaller businesses who don’t need to rely on buying cheap credit, rather than the larger firms who are highly restrained because of the current crisis in the debt market.

With this new deal going through, Bridgepoint, who split off from National Westminster Bank in 2000, will now equal its rival, 3i, and is very likely to reach its highest fund raising limit of €5bn before the end of summer, making it one of the largest mid-market firms in the sector.

Last week saw the Super Return conference take place in Munich, at which many investors spoke out about their ties to private equity, stating that they thought it best to move out of the larger buy-out firms because of the current turmoil in the credit market.

Senior investment officer at Calpers, a U.S. pension fund, Leon Shahanian, has stated that he has moved his $42bn private equity portfolio into a more defensive position, away from large firms and into mid-market firms.

What makes Bridgepoint a mid-market group is that they only invest in companies worth under €1bn, and this has allowed them to become one of the most active in the market since the onset of the credit crises. The companies latest acquisition, for £345m, was Pret A Manger, a sandwich chain.

Another means to success for Bridgepoint has been in disposals, with moves like selling Alliance Medical, a diagnostic imaging group, to Dubai International Capital, last November.

Bridgepoint have their eye on a few companies in the market at this stage, with hired bankers taking a look at 1st Credit, a debt collector; Pets at Home, a pet retail store chain; and Tunstall, a healthcare communications company.

When the Pret A Manger deal is signed, Bridgepoint’s current €2.5bn fund - with the title of Bridgepoint Europe IV - will be invested up 85%. This fund has been raised since September last year at the onset of the credit crisis.

Some current investors with the company are even considering reinvesting with the new fund. This group includes Calpers, the Canadaian Pension Plan Investment Board, and the Washington State Investment Board. Investors in Bridgepoint from the U.K. include the Universities Superannuation Scheme, and Wellcome Trust.

Last year Bridgepoint moved into the eastern Eurpean market and opened an office in Warsar. In November the company acquired rail operator, CTL Logistics, for roughly €400m.

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