Deals

3i hires for public investments

The quoted private equity manager estimates there are companies worth about €70bn where an investment would be more appropriate than an all-cash take-private and it has built a heavyweight team to tackle the opportunity.

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3i Group, Europe’s largest quoted private equity business, has created a new team to invest in European quoted companies, which may not be suited to an all-cash take private transaction.

It has made several heavyweight hires.

Bruce Carnegie-Brown, who will lead the team and join 3i’s management committee, is a former chief executive of insurer Marsh and head of JP Morgan Chase’s European debt capital markets business.

He will be joined by Stephen Hill, former chief executive of Betfair and the Financial Times, and Richard Segal, former head of PartyGaming. 3i buyout veteran Alan McKay also joins the group, and further appointments are expected.

They are joined by Alan MacKay, who has held a number of senior roles within 3i’s European private equity business.

3i chief executive Philip Yea said the firm had seen “an increasing level of opportunity within the public markets” over the last year. 3i estimates that companies in this segment have a total market capitalisation of about €70 billion ($92 billion).

Hill was chief executive of the Sporting Exchange, better known as Betfair, between 2003 and 2005. He had previously spent 16 years with the Pearson Group, where he ran the Financial Times newspaper and publishing group.

Segal led PartyGaming through a £4.7bn (€7.0bn) flotation on the London Stock Exchange in June 2005.  Before joining PartyGaming, he led a management buyout of Odeon, a cinema chain, which was backed by UK firm Cinven.

This dedicated team will draw on 3i’s experience of both private equity and public markets to generate private equity returns by applying private equity management skills to the small and mid-cap listed companies in which it will invest.

At the outset, the team will be focusing on industrial and consumer sectors across Europe.

3i’s move follows SVG Capital, Permira’s largest investor and a fund of fund manager, which also has a public equity team which also looks to generate private equity returns from its investments.