News & Analysis

Coller picks up tail-end Carlyle stakes

The London-based secondaries firm has picked up four stakes in two Carlyle European buyout funds, according to regulatory filings.

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Coller Capital has bought stakes in two Carlyle Group European buyout funds, according to UK regulatory filings.

Coller bought two stakes in Carlyle Europe Partners II (CEP II) and two stakes in Carlyle Europe Partners III (CEP III) from ING Bank through Coller Partners 605. It was not clear which of Coller’s funds Coller Partners 605 is associated with, and the vehicle is registered in Guernsey.

The deals closed on 1 October, according to the filings.

CEP II is a €1.8 billion buyout fund that closed in March 2005 after about two years of fundraising, according to PEI’s Research and Analytics division. The fund, which focuses on leveraged buyouts in targeted industries across Europe, generated a return multiple of 2x and had a net internal rate of return (IRR) of 20 percent as of 30 June, according to Carlyle’s 2015 second quarter earnings report.

The fund was used to acquire a 70 percent stake in Italian aircraft engine manufacturer Avio, which was sold to London-based Cinven for €2.6 billion in 2006.

CEP III closed above its €5 billion target on  €5.4 billion in July 2007 after a year of fundraising, according to PEI data. The vehicle is one of Carlyle’s strongest performing funds, helping to generate the majority of the realised net performance fees in the second quarter of this year, according to the earnings report.

The fund generated a return of 2.1x and a net IRR of 15 percent as of 30 June.

Carlyle fund stakes have been actively traded on the secondaries market this year. In September, Chilean firm Moneda Asset Management sold a portion of its stake in Carlyle Europe Partners IV to Brazilian wealth manager Pragma Gestão de Patrimônio, and in April, Strategic Partners acquired stakes in Carlyle Asia Partners III from Kuwait manufacturing and investment conglomerate National Industries Group, according to filings.

Banks have largely sold off their private equity holdings due to regulations such as the Volcker Rule and Basel III, which either restrict the amount of the asset class financial institutions can hold or make it expensive to hold on their balance sheets.

It was not clear why ING sold its stakes in CEP II and CEP III.

Coller declined to comment. Carlyle and ING did not respond to requests for comment.