Currently, 95 Europe-based fund managers incorporate a mezzanine strategy into their investment focus, according to Preqin’s Fund Manager Profiles database. Collectively, these firms have raised approximately €81bn in capital over the last 10 years and have an estimated €24bn available in dry powder. Of these firms, 32 focus solely on mezzanine investments.
Fifty-nine percent of all the capital raised by firms in the region has been raised by firms based in France and the UK. Twenty-nine UK firms have garnered €21bn and 20 French firms have collected €27bn in capital commitments over the last 10 years.
The top five fund managers that incorporate a mezzanine investment strategy into their investment focus, based on capital raised in the last 10 years are AXA Private Equity, Partners Group, EQT Partners, Intermediate Capital Group and Babson Capital Europe.
AXA Private Equity is based in France with a further six offices in Europe, two in Asia and one in the US. It pursues a balanced investment strategy as seen by their various types of funds which include buyout, secondaries, fund of funds and co-investment multi manager. It has raised approximately €20bn in capital over the last 10 years and has an estimated €7.7bn available in dry powder. Over the last decade, AXA Private Equity has raised two mezzanine funds, AXA Mezzanine I and AXA Mezzanine II, which have collectively garnered €699mn.
Partners Group is a fund of funds manager based in Switzerland focusing on mezzanine. It has a global geographic focus and along with mezzanine, it also focuses on buyout, growth and secondaries. Partners Group has raised approximately €14bn in total capital commitments over the last 10 years and has an estimated €3.7bn available in dry powder. The firm has raised three mezzanine private equity vehicles over the last 10 years, raising a combined €1.3bn in capital. The Europe-focused Partners Group Direct Mezzanine 2011 is currently targeting €500mn to invest in a broad range of industries.
Intermediate Capital Group has raised approximately €6.5bn in total capital commitments over the last 10 years and is the largest Europe-based fund manager to predominantly focus on mezzanine. The mezzanine transaction types it includes are buyout, recapitalisation, corporate expansion and public to private. ICG invest in companies based in North America, Europe and Asia in a wide range of industries. Its most recent fund, ICG Europe Fund V, reached a final close €1bn above target on €2.5bn in December 2012.