CVC Capital Partners Ltd., the private-equity firm whose investments include Formula One racing and Samsonite luggage, is planning what may become the largest buyout fund on the market, said two people briefed on the matter.
The firm, based in London, may seek as much as 10.75 billion euros ($13.5 billion) for its next European fund, said the people, who asked not to be named because the plans are private. That would be the same amount raised for CVC’s previous fund focused on European buyouts.
CVC, which may formally begin marketing the fund in the second half of the year, is entering a crowded field, with a record 1,858 private-equity funds vying for capital last month, according to research firm Preqin Ltd. Warburg Pincus LLC is targeting $12 billion for its next fund, the biggest on the market, while Carlyle Group LP (CG) and KKR & Co. are each seeking $10 billion. Blackstone Group LP (BX) raised the industry’s biggest fund at $21.7 billion in 2006.
Mary Zimmerman, an outside spokeswoman for CVC, declined to comment on plans for CVC European Equity Partners VI LP.
CVC is one of the few private-equity firms approaching or surpassing the mega-funds raised during the 2005-2007 buyout boom. Leonard Green & Partners LP is gathering more than $6 billion for a fund that will top its predecessor from five years ago, and Advent International Corp. stepped up its latest goal to 7 billion euros, people familiar with the firms said earlier this year.
Nordic Capital, which invests in Northern Europe, is seeking 4 billion euros, according to a marketing document. Among other European firms, Cinven Ltd., Permira Advisers LLP and Apax Partners LLP are raising funds that target at least 5 billion euros.
Return of 8.2%
CVC Capital’s European funds typically make equity investments of $150 million or more, according to the firm’s website. Founded in 1981, CVC also manages funds that focus on the Asia-Pacific region.
The prior fund, CVC European Equity Partners V, was generating 1.1 times capital and an 8.2 percent internal rate of return as of Dec. 31, according to performance data from Oregon Public Employees’ Retirement Fund.
The firm agreed yesterday to sell 21 percent of Formula One to BlackRock Inc. and two other investors for $1.6 billion as it prepares an initial public offering of the auto-racing series it took control of in 2006.
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