Fondinvest changes hands – exclusive

Now owned by two executives who worked together at a US financial services firm, Paris-based Fondinvest is raising its fifth secondaries fund.

Fondinvest Capital, a Paris-based fund of funds manager, has been acquired by two individual US investors for an undisclosed sum, Secondaries Investor has learned.

Hugh Dunkerley, a former managing director with US financial services firm Burnham Securities, bought a majority stake and became Fondinvest’s managing partner in April, Dunkerley confirmed.

Daniel McClory, currently a managing partner at Burnham Securities, has also purchased a minority share in the firm and will become a non-executive board member.

Terms of the deal, which closed in June, have not been disclosed.

“Working with the team at Fondinvest Capital has provided us with exactly the established brand, corporate culture, undisputedly successful fund management legacy, and future growth platform that we were looking for within Europe,” said Dunkerley. “I believe that there are many opportunities for Fondinvest to grow its assets under management, and make solid investments in the near future, so I am looking forward to our 10th fund closing and working as part of the proven investment team.”

Dunkerley is now running Paris-based Fondinvest, while Charles Soulignac, who founded the firm in 1994, is remaining chief executive and chairman of the firm’s investment committee. He’ll also continue to monitor Fondinvest’s existing assets.

“The board of directors of Fondinvest Capital, after an extensive and diligent evaluation and selection process, has approved the sale, to provide for a strong shareholding succession and transition plan, while preserving the proven methods and financial success of the firm,” Soulignac said in a statement obtained exclusively by Secondaries Investor.

Soulignac is not thought to be a key man for the firm’s latest secondaries-focused vehicle, Fondinvest X, which is currently fundraising, according to sources with knowledge of the matter.

Fondinvest declined to comment on fundraising.

The change of ownership presents a new chapter for the 20-year old fund of funds manager, which has long been considered a pioneer in the secondaries market. Sources close to the firm have said it addresses Fondinvest’s succession issue – founder Soulignac turns 70 next year – and will also help the firm attract new limited partners for its latest fund, particularly from the US.

Board and staff changes

Dunkerley was appointed a managing director with Burnham in 2013, according to his LinkedIn profile. Born in Hong Kong in 1973 and educated in the UK, Dunkerley has experience in direct investment, corporate finance and investment banking advisory services. He has managed several companies and has served on numerous boards. He is also chairman of Valor Group, a life insurance company.

McClory replaces David Caillard of Karroo Capital. Caillard had been on the supervisory board for several years when he left in June.

In terms of investment staff, Fondinvest has also had a number of changes. “There’s been a lot of turnover at the firm,” a source said.

Managing director Catherine Lewis La Torre left Fondinvest almost a year ago, while fellow managing director Emmanuel Roubinowitz left in December and is now at Rothschild’s Five Arrows, according to his LinkedIn account.

New arrivals have included Laurent Gillot, who returned to the firm in July as investment director. Gillot previously worked for Fondinvest between 2002 and 2008.

Back to fundraising

Since the sale, Fondinvest has returned to fundraising.

It has been almost six years since Fondinvest closed its most recent secondaries fund, Fondinvest VIII, which closed on €360 million in December 2009, after launching two years earlier.

The firm, which names its dedicated secondaries funds with even numbers (the odd-numbered funds being primary fund of funds), began to market Fondinvest X, its fifth secondaries fund, in April 2014, targeting €400 million. Sources have said that was halted temporarily and has now resumed, with the fund targeting €500 million, according to PEI’s Research and Analytics division.

The fund will focus on the European lower mid-market.

Founded in 1994, the firm has raised four secondaries vehicles since 1996, focusing on deals between €0.5 million and €50 million, according to its website, which notes it has €1.8 billion in assets under management.

Fondinvest has been mostly active on the secondaries sell-side this year, exiting stakes in Elderstreet Investments and Equistone Partners Europe to London tail-end specialist Hollyport Capital, according to UK regulatory filings.

Since the sale closed, the firm has also opened an office in Burnham’s New York office.