Preqin's comprehensive Fund Manager Profiles service reveals that 169 Europe-based private equity fund managers are considering distressed private equity investment opportunities. Collectively, these firms have raised €75bn in the last 10 years and have an estimated €22bn in dry powder. Preqin classifies a distressed private equity investment strategy to include turnaround, special situations and distressed debt. Of these sub-strategies, turnaround is the most preferred by these firms, with 113 fund managers considering investments of this nature. This is followed by 93 fund managers considering event driven, special situation investments and 55 fund managers considering distressed debt investment opportunities.
The UK has the largest base of fund managers considering distressed private equity investments, with just fewer than 40% based in the country. France accounts for the second most common country for fund managers to be based, with 10% of the 169 Europe-based fund managers considering distressed private equity opportunities based there. Germany follows closely behind accounting for 9% of Europe-based distressed private equity fund managers. These firms have collectively raised approximately €52bn in the last 10 years and have an estimated €14bn in uncalled capital. The firms which have contributed to the raised and uncalled capital consider other investment strategies as well as distressed private equity.
Alchemy Partners is the largest private equity firm to consider all three distressed private equity sub-strategies, and has raised a total of €1bn across all of its strategies in the last 10 years. The firm focuses predominantly on making buyout investments; however, since 2006 Alchemy Partners have diversified to include distressed debt and special opportunity investing. Established in 1997, the firm is actively investing in Germany, Switzerland and Austria and raised its latest distressed debt private equity vehicle, Alchemy Special Opportunities Fund II, in March 2011. The fund garnered £500mn, matching its target size and focuses investments in pan-European distressed debt and special situations.
Sweden-based firm EQT Partners predominantly makes buyout investments and has raised a total of €13bn in the last 10 years. The firm is currently raising its second distressed debt fund, EQT Credit Fund II, which has a target of €750mn and invests in operationally sound but overleveraged European companies. The firm has predominantly raised buyout funds; however, it has also previously raised a turnaround fund, and a number of mezzanine funds.