Carlyle spin-out Resource doubles fund in top-up

Kimberly Romaine
30 November 2011

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The appeal of a handful of firms belies the dearth of LP appetite for private equity.

Resource Eastern European Equity Partners has increased the size of its debut fund to €293.4m in a top-up from existing LPs. The injection of new capital nearly doubles the size of the vehicle, which closed on €156.1m in October 2010.

The Resource fund overcame market negativity to reach a €51m first close in October 2009 and a second close on €102m in May 2010. The vehicle has invested in six businesses and three add-ons, corresponding to €80m of fund money as well as €40m of co-investment capital from its LPs. It is currently roughly 50% invested.

Europe's precious few fund announcements stem disproportionately from CEE this year: just last month, unquote" exclusively reported on a first close of Abris Capital Partners' second fund on €210m. The first close is comprised of 12 investors, two of which are US endowments and new to the fund. Unlike some other funds raised this year, Abris did not offer any sweeteners to come in at first close. Similar to Resource, Abris has blue-chip, global roots: one of the co-founders was at Advent International.

Both Resource and Abris reached closes without the use of a placement agent. In fact, fundraising advisers approached by Resource prior to its launch had given the fund's plans a lukewarm response.

A total of 20 prospective LPs were targeted by the Resource team, mostly in Europe and some in the US. The EBRD provided ‘warm' support in early 2009, followed shortly thereafter by Rabobank. Both of the institutions became cornerstones, with EBRD ultimately committing €40m and Rabobank €25m. Terms for the two institutions were 'commercial' so as not to put off other investors. Following the first close, AXA and EIF also came on board, contributing €50m and €40m respectively. The partners contributed €3m, up from €1.02m at the first close.

Resource Partners focuses on consumer opportunities, including the food and agribusiness sector in Poland, corresponding to at least 60% of the portfolio. The remainder will be invested across a range of sectors.

Ryszard Wojtkowski, Aleksander Kacprzyk and Piotr Noceń manage the company based in Warsaw. The three, together with investment director Magorzata Bobrowska-Jarząbek and Dan Farcasanu , all came over from the original Carlyle CEE outfit. The Resource team is now 10-strong.

Resource Partners was founded when Carlyle cut all new initiatives in emerging markets in November 2008. The team immediately decided to keep the majority of the group together and approached public institutions less constrained by freezes on fundraising and selected private investors with a strategic interest in the region.