Fundraising

TDR Capital second fund closes on €1.75bn

After just four months, TDR Capital has raised €1.75bn for the successor to its €550m debut fund.

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TDR Capital, the UK private equity firm, has held a first and final close of €1.75 billion ($2.24 billion) on its second fund after just four months of marketing.

Thompson: no change in strategy for fund II

Blair Thompson, who moved from a partner position at law firm SJ Berwin to the role of chief operating officer at TDR Capital earlier this year, said that marketing for TDR Capital II begin at the beginning of March: “The fundraising was rather quicker than we expected, but it appears that the market is able to move reasonably quickly right now.”

Lazard acted as placement agent on the fundraising. SJ Berwin provided legal advice.

Thompson said that all investors in TDR Capital’s first fund, which raised €550 million in 2002, committed to fund II, with a roughly 50:50 split between new and existing limited partners: “In addition to half of the investor base being new, there was a similar split in terms of region, with half of our investors from Northern America and the other half from Europe and Asia, mainly Europe.”

TDR Capital I is now “pretty much” fully invested, said Thompson. The fund’s investments include the public-to-private acquisitions of Pizza Express in 2003 and ASK Central in 2004, as well as the £1 billion acquisition of a number of closed life insurance funds from UK financial services company HHG and modular buildings provider Elliott Group in 2005.

Thompson said that the change in size of fund did not represent a change in strategy: “It’s not as big a difference between fund sizes as it looks and there is no change in our investment strategy. The amount raised was the amount we felt comfortable that we could spend over the next five years.”

Following the fund closing, Sean Farrell is due to join TDR Capital as an investment director. Farrell was previously a vice president at Texas Pacific Group and has previously worked for Boston Consulting Group and Goldman Sachs. Farrell’s appointment, due to begin in the next few weeks, will bring the firm’s number of investment professionals to nine.