CVC Capital Said to Seek $12.2 Billion for Buyout FundSabrina Willmer
CVC Capital Partners Ltd., the private-equity firm whose investments include Formula One racing and Samsonite luggage, is targeting 9 billion euros ($12.2 billion) for one of the largest buyout pools currently being sought, according to three people familiar with the matter.
CVC’s sixth fund, while seeking less than the 10.75 billion euros its predecessor gathered in 2008, has no limit on how much it can raise, said the people, who asked not to be identified because the fundraising is private. Mary Zimmerman, a spokeswoman for London-based CVC, declined to comment.
Warburg Pincus LLC and Silver Lake Management LLC are gathering multibillion pools for their latest funds. Warburg Pincus, based in New York, is seeking $12 billion for its newest pool, and Silver Lake, the private-equity firm said to be discussing a potential buyout of computer maker Dell Inc., is targeting $7.5 billion. Advent International Corp., a Boston-based buyout firm that invests in Europe and the U.S, last year raised 8.5 billion euros.
CVC Capital is allowing prospective investors online access to due-diligence materials and is expected to distribute marketing documents shortly, according to the people.
The firm’s 2005 fund, which raised 6 billion euros, was generating a 17 percent net internal rate of return and a 1.75 times multiple as of Sept. 30, according to performance data from Oregon Public Employees Retirement Fund. The most recent fund, CVC European Equity Partners V LP, was producing an 8.8 percent net IRR and a 1.26 times multiple as of the same date.
The firm has reaped gains from its investment in Formula One motor racing from its 2005 fund, CVC European Equity Partners IV LP. It has made more than $4 billion on its original $1 billion investment, co-founder Donald Mackenzie said during an interview in October. Mackenzie said the firm expects to make as much as $7 billion on the holding and was considering selling its remaining stake through an initial public offering.
The firm’s chairman Michael Smith stepped down this month as CVC prepares to raise its new fund. Mackenzie, Rolly Van Rappard and Steve Koltes, three of CVC’s remaining founders, are taking over as co-chairmen. CVC, which last year sold a stake in itself to three sovereign-wealth funds, plans to remain private, unlike some of its U.S. competitors.
Through its European funds, CVC Capital makes equity investments of at least $150 million, according to the firm’s website. The firm on Jan 2. agreed to buy Cerved, an Italian provider of business credit information, from Bain Capital and Clessidra SGR SpA.
It invests in global industrial and service businesses. Founded in 1981, CVC also manages buyout funds that focus on the Asia-Pacific region.