INVENIO on the market for Southeast Europe-focused growth fund

Boris Maleshkov
23 November 2022

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INVENIO Partners, a Bulgarian PE firm focusing on Southeast Europe, is on the fundraising trail for its second investment vehicle, aiming for a EUR 75m close by the middle of next year, CEO Elvin Guri said.

The Sofia-based sponsor held a first close for INVENIO Partners II on EUR 35m last year and has so far received EUR 55m in commitments. LPs in the fund are family offices, high-net-worth individuals and institutional investors, including, among others, the European Investment Fund (EIF) and two Bulgarian pension funds.

It will seek to attract further Central and Western Europe-based pension funds, family offices and high-net-worth individuals with an appetite for or experience with the risk associated with investing in Southeast Europe, Guri said.

The Luxembourg-licensed fund has a 10-year life and has standard fees for its region and strategy, he said.

Investment plans
With a view to making 8-12 transactions, the vehicle will be deployed in growth equity deals of EUR 3m-10m in SMEs based in Bulgaria, Romania and Serbia, Guri said. Ideal targets will be companies in recession-proof sectors like export-oriented manufacturing and healthcare that are looking to expand regionally and globally.

INVENIO will invest in majority stakes but would consider significant minority stakes of around 40% in special growth situations.

Earlier this year, the firm invested EUR 3m in Bulgarian healthcare data and analytics provider SAT Health and EUR 2m in Bulgarian bicycle and e-bike frames producer Cycle GETS.

With plans to make three acquisitions by the end of next year, Guri said the firm is in active talks with 3-4 potential targets but is in no rush to close deals now, mindful of a possible recession next year that could last for 24-36 months in the worst-case scenario.

Portfolio management
INVENIO Partners was founded in December 2021 following the rebranding of Empower Capital, a EUR 21m fund backed by EIF and established in 2014 to provide equity and quasi-equity funding to growing Bulgarian companies.

INVENIO pitches itself as a more hands-on investor compared to other buyout vehicles in the Balkan region, being actively involved when it comes to running portfolio companies, Guri said. Its partners are industry specialists and entrepreneurs who see themselves more as managers with money to invest, he added.

"Our approach is very hands-on since we believe this style is more suitable for companies in the up-to-EUR 10m equity ticket segment in Southeast Europe," Guri said.

The fund is managed by Elvin Guri, Stanislav Nikolaev, Slavcho Parushev, Tihomir Dyankov and Tony Romani.

Some of Empower Capital's investments include facility management provider Mundus Services, hospital chain City Clinic, dairy products manufacturer Cremio as well as biospecimen collection and clinical research provider Fidelis Research.