Neuberger Berman backs Fondo Italiano spin-out

The investment firm has acquired minority direct stakes in the fund's portfolio companies and will work with the Italian manager to raise a country-focused fund.

Neuberger Berman has backed the spin-out of the private equity arm of Italy’s Fondo Italiano d’Investimento in a deal that involves direct stakes in the state- and privately-backed fund’s private equity portfolio, Secondaries Investor has learned.

The deal, which closed in October, means the US firm will pay around €300 million for minority interests in 22 Italian SMEs, according to a source familiar with the transaction.

Neuberger and Fondo Italiano will create a joint venture that will aim to raise a vehicle to invest in Italian private equity. The size of the proposed vehicle is between €500 million and €1 billion, according to Italian newspaper Milano Finanza.

The relationship between Fondo Italiano’s existing portfolio and the new vehicle is unclear.

The deal received unanimous support from Fondo Italiano’s investors, according to the  source.

Tikehau IM, the independent European asset management arm of French alternatives house Tikehau Capital, also bid for the deal, according to two sources familiar with the deal. Secondaries Investor understands that the process went through multiple rounds before Neuberger was selected at the end of June.

It is understood that Credit Suisse advised on the process.

Secondaries Investor reported in March that Fondo Italiano was working with Credit Suisse to offload its portfolio of direct stakes.

Many of the assets in the fund are majority owned by Italy-based families and some potential bidders were concerned about future exit strategies, sources said at the time.

“There are some very good companies in there but how you eventually get out of these positions is the question,” one of the sources said.

Along with its private equity fund, Fondo Italiano d’Investimento has a fund dedicated to direct venture capital investments and one toward fund of funds, according to its website.

Companies in the private equity portfolio include pharmaceuticals traceability technology firm Antares Vision and plastics manufacturer Amut.

Fondo Italiano’s shareholders, all of which hold stakes of 12.5 percent, are the Italian Ministry of the Economy and Finance, Cassa Depositi e Prestiti, the Italian Banking Association, General confederation of Italian Industry, Intesa Sanpaolo, MPS Investments, UniCredit and the Central Institute of Italian Popular Banks.

Neuberger was involved in a similar deal in 2015 when it helped bank Intesa Sanpaolo spin out its merchant banking and private equity teams. The venture, NB Renaissance, raised a €300 million Italian private equity fund in July, according to a press release.

Fondo Italiano d’investimento, Neuberger Berman and Tikehau did not return requests for comment. Credit Suisse declined to comment.