Nordic Capital, a Swedish buyout firm specializing in Scandinavian and German-speaking countries, raised about 1.7 billion euros ($2.2 billion) in the first close of its latest fund, said two people briefed on the matter.
The close was announced at an investor meeting in London yesterday, the people said, asking not to be named as the details aren’t public. Nordic Capital plans to raise about 3 billion euros for the fund, its eighth, by summer, they said.
Globally, private-equity businesses face pressure to raise capital as investment periods on funds raised between 2006 and 2008 begin to expire. As many as 708 firms face such deadlines through 2015, London-based research firm Preqin Ltd. said. Worldwide leveraged buyouts surged to about $75 billion so far this year from $51 billion from the year-earlier period amid cheap financing, according to data compiled by Bloomberg.
More than 40 investors came in at the first close of the Nordic Capital fund, including Scandinavian, U.S. and other European limited partners, the people said. Investors included the Washington State Investment Board, which also took a stake in Nordic Capital’s 4.3 billion-euro pool raised in 2008, one of the people said.
Nordic Capital, which began marketing the fund last April, told investors in October that it would reduce the proposed size of its latest fund to 3 billion euros from 4 billion euros, people familiar with the talks said at the time. Still, the buyout firm collected 1.7 billion euros in the first close, more than the 1.5 billion euros they’d expected, one person said today.
An official at Nordic Capital declined to comment on the fundraising plans.
Cheap borrowing costs and record corporate profits have fueled $345 billion in deals this year, including the $24.4 billion plan by Michael Dell and Silver Lake Management LLC to take computermaker Dell Inc. (DELL) private.
Nordic Capital, founded in 1989, specializes in health care and holds about 28 companies with total revenue of more than 11 billion euros. The buyout firm made six acquisitions in 2012 and five exits in the last two years, including the sale of closely held Fougera Pharmaceuticals and Nycomed A/S, a pharmaceutical company.
Nordic Capital competes locally with Stockholm-based EQT Partners AB and IK Investment Partners AB. Sweden has become Europe’s largest private-equity market compared with the size of its economy and 30 percent of all direct foreign investments in the country stem from the leveraged-buyout industry, Nordic Capital said in January.
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