ICG backs PineBridge spin-out restructuring – exclusive

More than 70% of LPs in New Europe Partners II chose to sell their stakes in a deal that closed on Friday, Secondaries Investor has learned.

ICG has closed a deal to restructure a 2006-vintage Central and Eastern Europe-focused fund, almost three months after Secondaries Investor reported the fund’s manager had restarted the process.

The London-headquartered investment firm’s strategic equity team backed the deal in which assets from New Europe Partners II will be moved into a four-year continuation vehicle, according to two sources familiar with the matter.

New Europe Partners II, which is managed by PineBridge Investments spin-out ForeVest Capital Partners, holds five assets and has a net asset value of €218 million, according to one of the sources. It is unclear which valuation date the deal is based on.

The transaction closed on Friday and Park Hill advised on the process.

ICG has closed at least three GP-led transactions in recent weeks. In May the firm teamed up with Committed Advisors to partially free the captive private equity arm of Japanese conglomerate Orix Corporation in a $120 million deal, as Secondaries Investor reported. The firm also joined Goldman Sachs Asset Management to back the spin-out of Chinese investment firm ZZ Capital International’s private equity team in a deal announced in June.

New Europe Partners II originally closed on €523 million and was managed by PineBridge, according to PEI data. Four senior managers of PineBridge New Europe Partners spun out in 2016 to form ForeVest with a focus on growth equity investments in mid-market companies across the CEE region.

The five assets in NEP II are home care services provider Promedica24, automated lockers technology provider Integer, lead-acid battery recycler Orzel Bialy, forex brokerage firm TMS Brokers and employment agency Work Service.

By value, more than 85 percent of LPs in NEP II approved the deal and 70 percent of LPs in total decided to sell their stakes, one of the sources said. The transaction resets carried interest and other incentives for ForeVest, which has doubled its GP commitment to the assets through the deal.

Investors in New Europe Partners II include the European Bank for Reconstruction and Development, which committed €50 million, according to PEI data.

Private equity funds focused on Central and Eastern Europe were hit hard by the global financial crisis of 2007-08. Fundraising for CEE private equity fell from €4 billion in 2007 to €2.51 billion in 2008 and €378 million in 2009, according to data from industry body InvestEurope.

ICG declined to comment. ForeVest and Park Hill did not return requests for comment.