Innova Capital closes fund at €225m

The Polish private equity manager has closed its Innova/4 LP fund at €225 million, and boasts a 1.5 percent commitment from the firm’s partners.

Innova Capital, a Polish private equity manager, has closed its Innova/4 LP fund at a hard cap of €225 million ($288 million).

Innova/4: will invest in commercial manufacturing sectors

Innova Capital, which focuses on mid-market buyouts in Central Europe, launched the fund in October 2005 with a target of €175 million.  This was later increased due to investor demand.

The fund features a 1.5 percent commitment from the general partner, which Innova Capital believes to be the highest among Central European fund managers.

Axon Partners, a European provider of private equity funds services, acted as the exclusive placement agent for Innova/4.

Innova/4 received commitments from over 20 investors worldwide, about half of which came from existing investors.  The balance came from new investors, including LODH Private Equity AG, Adveq Management, Northwestern University, Parish Capital, Gartmore Investment Management and several family offices in both Europe and the US.

Overall, 75 percent of commitments came from European-based investors, with the balance provided by American groups.

Participation by family offices, including London-based Fleming Family & Partners, was significant, representing 36 percent of total commitments.

Steven Buckley, co-founder and managing partner of Innova Capital, said: “Despite requests to raise the hard-cap, Innova configured the fund to maintain a mid-market discipline.  With strong demand from current investors, this meant we reluctantly turned away a few high quality investment groups.

“We’re seeing a lot of German and Polish cross-border activity, including investments in wind generation, specialised automotive parts and precision engineering in white goods.”

Innova/4 LP will pursue an investment strategy focused on mid-market buyouts in the business services and commercial manufacturing sectors.

Innova Capital has been active in the region since 1994, investing over $280 million in 33 companies and exiting 25 deals.  Innova Capital’s previous fund delivered a projected cash-on-cash return of more than 3.5 times its investment.  In 2005, Innova Capital distributed $213 million to its investors.