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CapMan to acquire Russian private equity house Norum28/05/2008. Source: AltAssets. 
 CapMan, a European firm with Nordic roots, has agreed to acquire management companies of Norum Russia Fund III from the company's senior management, DnB NOR Bank and Sitra Management.
In the first phase of the transaction, 51 per cent of Norum Russia Fund III's management company's and 100 per cent of the advisory company's share capital and voting rights will be transferred to CapMan's ownership for a purchase price of about €3.4m, according to a statement. The said purchase price will be adjusted on the basis of the final size of Norum Russia Fund III, which is currently in fundraising mode and has already received €88m in commitments, including a €13.5m commitment from CapMan. The fund, with a €150m target, is to be renamed CapMan Russia Fund.
CapMan said it will finance the acquisition with cash and a directed share issue to the sellers.
Norum's investment focus is on small and medium-sized companies in Russia with an enterprise value of approximately €5-50m. Target companies typically operate in sectors such as consumer goods and services, manufacturing, telecom, transportation, financial services and media, and have net sales of approximately €5-100m. Norum has offices in Moscow and St Petersburg. As part of the agreement, the firm's 13 private equity professionals will transfer to CapMan.
CapMan CEO Heikki Westerlund said, 'The announced transaction is a significant step in CapMan's strategy of utilising growth opportunities within the alternative asset class. Russia is one of the fastest growing economies with a strongly emerging private equity market.'
CapMan will have the right to buy the remaining 49 per cent of Norum shares and voting rights when the investment period for CapMan Russia Fund ends - no later than July 2012.
Norum I and II will continue to be managed by the Nordic Russian Management Company, under an agreement with the European Bank for Reconstruction and Development.
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