Small is becoming beautiful again – at least in the world of private equity.
Mid-market operator Bridgepoint will this week secure new commitments from investors taking it beyond its €4bn fundraising target, reports the FT. The continued demise of the mega-LBO after last summer’s seizure in the debt markets has shifted focus towards those operating further down the corporate food chain who are less reliant on abundant supplies of cheap credit.
Its latest fundraising, now set to reach its €5bn hard cap by the summer, will make it one of Europe’s largest mid-market focused buyout funds, alongside publicly-listed rival 3i.
Bridgepoint is leading the way in other areas. Three months after Sir David Walker published his voluntary code of conduct for the UK’s private equity industry, the firm will be the first to comply with the requirement to publish an annual review. In that report, managing partner William Jackson will note that while credit markets took a tumble last year, “middle market financing remained available on terms more typical of those available two years ago.”
Some in the industry hope that firms such as Bridgepoint, whose portfolio companies may fall below the minimum reporting standard set by Sir David, will opt to go above and beyond the letter of the code in making information available. After all, with its recent investment in Pret a Manger, and well-known and well-liked brands such as Fat Face, Faith and Holmes Place on its books, Bridgepoint has a shot at being the lovable face of private equity.