Idinvest plans to launch third secondaries fund within six months – exclusive

The Paris-based fund of funds manager will seek under-the-radar mid-market deals with its latest secondaries vehicle.

French private equity firm Idinvest Partners is looking to start raising its third dedicated secondaries fund by the end of 2015 or early 2016, according to a source familiar with the matter.

The strategy of the third fund would be similar to that of Idinvest Secondary Fund II, targeting around a dozen different underlying deals in Europe which are on average €25 million to €50 million in size, the source said.

Idinvest declined to comment on details of the new fund but a spokesperson in Paris confirmed the firm is close to the point where it will ask its investor base to prepare for its next fundraise.

There is “strong appetite” for a successor fund from a large number of the firm’s current investors who are attracted to Idinvest’s ability to carry out mid-market deals, according to the source.

A spokesperson for the firm said Fund II, which closed in March 2014, is more than 60 percent invested in 12 secondaries transactions across diversified sectors and geographic areas.

“A large number of transactions in the secondary market are under the radar screen of Ardian, Coller and HarbourVest,” the source said, adding that Idinvest’s secondaries funds look for mid-market opportunities in continental Europe where, unlike the established UK market, there are more value-added, inefficient transactions to be found.

Idinvest Secondary Fund II, which began marketing in 2012, held a final close at €228 million,  above its initial €200 million target. The fund focuses on mature secondaries transactions in the European small and mid-market.

The firm’s first secondaries fund was raised when it was a unit of Allianz Group. Idinvest spun out from Allianz in 2010, and Allianz has remained an investor in the firm, including in its second fund.

The firm also focuses on mezzanine debt funds and last week closed its latest fund, Idinvest Private Debt III, above target at €400 million.

The firm’s assets under management have doubled to €5 billion since its foundation in 2010. Idinvest co-invests with top performing European leveraged buyout funds supplemented by secondaries investments, according to its website.