Hollyport buys portfolio of PE stakes from Fondinvest

Hollyport has purchased a portfolio of private equity fund stakes, including Equistone Partners Europe Fund I.

London-based secondaries firm Hollyport Capitahas acquired a portfolio from mid-market Parisian firm Fondinvest Capital, a source familiar with the matter told Secondaries Investor.

The size of Fondinvest’s portfolio is not known but it included a stake in Equistone Partners Europe Fund I, according to UK regulatory notices. The fund is fully realised and has been packaged with other funds, a source said.

Fondinvest did not return a request for comment by press time.

Equistone Partners Europe Fund I was formerly known as Barclays European Fund. Equistone bought out Barclays’ private equity division in 2011, according to the firm’s website. As part of that deal, Equistone took over the management of Barclays Private Equity’s (BPE) three buyout funds, BPE Funds I, II and III, PEI’s Research and Analytics division revealed. The firm continues to target similar strategies to Barclays – deals between €50 million and €300 million. 

The 2002-vintage fund received €600 million in commitments and an additional €650 million from Barclays, creating a total of €1.25 billion in pooled capital.

LPs include long-time Equistone investor the West Yorkshire Pension Fund, which committed about €15 million to the fund, according to PEI data.

The fund made 38 investments in consumer, business and financial services companies throughout Western Europe, including female fashion retailer Hobbs. Equistone paid £30 million ($45.3 million; €38.3 million ) for an 80 percent stake in the company. It then grew the business from 34 retail outlets to more than 60 outlets and doubled pre-tax profits to more than €13 million, according to the firm’s website. In 2004, Equistone sold the business to 3i for €161 million.

The fund also invested in outdoor fashion brand Jack Wolfskin in May 2005 in partnership with Quadriga Captial. Equistone and Quadriga sold their stakes through a secondary buyout to Blackstone for an undisclosed sum in 2011. 

The fund’s most recent exit was the sale of French construction and property development company Spie batignolles to Ardian in July 2014. Equistone acquired the company in 2003 and sold its remaining share this year. 

Fund I is fully realised and approaching the end of its life. The fund is likely to be liquidated in the first or second quarters of this year, a source confirmed. 

The fund was generating a 29 percent net internal rate of return and 2.2x net cash-on-cash multiple as of December 2014, the source added.

Equistone declined to comment.

Hollyport acquired the fund stake using its fourth dedicated secondaries fund, Hollyport Secondary Opportunities IV, which closed in December on £75 million, according to PEI data.

Fund IV is more than 35 percent deployed, Secondaries Investor had previously learnt. The fund has invested in 10 acquisitions, a combination of single stakes and portfolios of tail-end stakes in European and US buyout, venture, mezzanine and growth funds.

Hollyport declined to comment.