Capzanine holds final closing on €350m hard-cap

Total capital commitments exceeded the original €300m target. Athos Partners acted as placement agent, with SJ Berwin providing legal advice.

Capzanine started pre-marketing efforts in Q3 2011 and formally launched the fund in January 2012. The vehicle reached a €200m first close in July last year.

Despite exceeding its original target, the GP stated that it had to face a number of obstacles during the process, including several LPs' cautious attitude to investing in France, as well as pressure on terms & conditions, fees and reporting.

However, Capzanine noted that the current LP appetite for liquidity made mezzanine an attractive proposition given the regular distributions it enables.

Capzanine is not the only French player to have closed a mezzanine vehicle in recent weeks. Earlier this month, CIC Mezzanine topped-up its initial €165m closing of CIC Mezzanine 3, taking total capital commitments to €180m. The third fund had already made five investments and deployed nearly a fifth of overall commitments by early May.

Investors
Capzanine saw investors in its previous vehicles commit to around 55% of the new fund. The GP's traditional LP base comprises family offices, institutional investors and funds-of-funds, and includes investors such as Amundi Private Equity Funds, Golding Capital Partners and Groupe Agrica.

New LPs that came in at first close include the European Investment Fund and OFI Asset Management. The GP stated that the new investors in Capzanine 3 mostly hail from outside of France.

Investments
Capzanine 3 will invest €7-50m per transaction in French companies with an enterprise value of €20-300m. It aims to complete 20-25 investments over a five-year investment period. Around 70-75% of the capital will be deployed as mezzanine, with the remainder being equity investments.

For transactions valued at less than €60m, the GP will arrange both the equity and mezzanine components. It will focus on arranging mezzanine financing for transactions beyond that threshold.

The vehicle has already backed air cargo management services firm ECS Group and manufacturing equipment provider Brèteche Industrie.

People
David Hoppenot is a founding partner at Capzanine.

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