UK-listed private equity group 3i has raised £400 million ($800 million, €594 million) for its latest vehicle, which will allow the group to invest in listed European small and mid-sized companies without taking them private.
The aim of the vehicle is to apply private equity style shareholder activism to companies that are still in the public markets.
3i Quoted Private Equity has sold 400 million shares at £1 each via a share placement, in line with plans announced in May. 3i has subscribed for 188 million of the shares, which will be issued on June 29.
According to a company spokesperson, the company plans to have invested most of the net proceeds of the placing within 18 months period of the listing. It will then use appropriate gearing to fund further investments over the remainder of the initial investment period. The vehicle is expected to make investments in 8-12 companies, and is targeting a 16 percent return per annum.
3i affiliate Indian software services firm 3i Infotech has also raised $100 million (€74 million) through an issue of foreign currency convertible bonds, which will be listed on the Singapore stock exchange.
3i has been actively developing additional strings to its bow in recent months. In addition to the Quoted Private Equity fund, it has also launched a listed infrastructure fund, and announced a joint venture with an Indian infrastructure firm. It follows a bumper year for the group, which saw it return a further £800 million to shareholders.