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CVC underlines ‘two-tier’ fundraising environment by surging to €10.5bn hard cap

22 Jul 2013

euro_note_170sqEuropean buyout giant CVC Capital Partners has stormed its way to a €10.5bn final close on the hard cap of its latest flagship private equity vehicle.

Reports began emerging at the end of June that the firm had managed to oversubscribe CVC Capital Partners VI in just six months amid a push to get as much capital together ahead of new fundraising laws coming into force today.

The firm said it had formally accepted €10.25m of commitments from investors, with the remaining €250m allocated and expected to hit a legal close towards the end of the third quarter.

That total rivals the €10.75bn it managed to collect for its last flagship fund at the height of the buyout boom, solidifying the environment in which some buyout houses are sweeping up easy capital while others languish post-financial crisis.

It said 90 per cent of the capital was provided by investors which had already committed to CVC funds, and confirmed the vehicle had only been launched in January.

CVC co-chairman Steve Koltes said, “We are pleased and honoured that the investment community has shown so much interest in our latest flagship fund.

“It is a vote of confidence in Europe and in CVC’s deeply-rooted and highly qualified professionals across the region.

“After 32 years of private equity investment in Europe, and despite the many challenges the region faces, we continue to remind our investors that Europe is home to more globalised, highly competitive and well-managed companies than any other part of the world.”

In May it was reported that CVC aimed to hold a €7bn first close before July 22, which would enable it to qualify for exemptions from the EU’s Alternative Investment Fund Managers Directive.

AIFMD allows national regulators to limit access to EU LPs from non-EU domiciled funds, such as CVC’s Channel Islands-based mega fund.

Meeting the deadline would allow the firm to continue to sell to EU investors much as it has done in the past, it believed.

But that strategy has become irrelevant after it managed to gather all the capital ahead of the regulatory change coming into play.

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