France-Focused Private Equity Fundraising - July 2015

by Luke Goldsmith

  • 31 Jul 2015
  • PE

In spite of the uncertain economic landscape in France and the eurozone as a whole, France’s private equity fundraising is picking up. Already this year, over €2bn of capital has been raised by 10 funds investing solely or predominantly in the country. This shows fundraising is on pace with 2014, when 23 vehicles collected €3.6bn in aggregate capital commitments. These potentially unexpected figures come with France experiencing stagnant or very little GDP growth: 0.2% in 2014 and 0.7% in 2013.

The unstable economic environment in the eurozone is contributing to the fact that fundraising figures are still some way off the levels seen before the global recession in 2007 and 2008. As shown in the chart above, these two years saw €4.3bn and €4.5bn raised respectively, when the financial markets were booming. Of the eight largest France-focused funds raised since 2006, four were closed in 2007 and 2008. The largest fund ever raised with a sole or predominant focus on France is the €2bn France Investissement III, a fund of funds vehicle closed in 2012 that invests in both regionally and nationally focused vehicles, along with funds that have an international dimension in connection to France.

The largest France-focused fund closed so far this year is Fonds de Logement Intermédiaire, a real estate fund which opportunistically develops socially responsible and environmentally friendly residential property in Paris and other French cities. The fund, which closed on just over €1bn, is the largest fund to focus on France since 2011, when Astorg V closed on €1.1bn. Euromezzanine 7 was the largest private equity fund raised last year, closing on €695mn. The fund makes mezzanine investments predominantly in France but also considers other West European countries.

In the current economic climate it is unlikely that the fundraising figures seen just before the financial crash will be surpassed. Nevertheless, there are currently 23 funds in market targeting €5.7bn in aggregate capital. White Knight IX is one of the largest three funds in market targeting €1bn, ensuring that this year has every chance to further boost France’s fundraising figures.

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