Orlando closes fourth special situations fund on €320m

Oscar Geen
30 May 2017

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Munich-, Stockholm- and Zurich-based private equity house Orlando Management has closed its fourth fund, European Special Situations Venture Partners IV (ESSVP IV), on €320m.

The fund will be managed out of all three European offices and will invest in special situations in the DACH region's Mittelstand, as well as in the Nordic countries. The fund is domiciled in Guernsey.

MVision Private Equity Advisers acted as placement agent for the fund, while Clifford Chance and Flick Gocke Schaumburg provided legal advice.

Its predecessor, SSVP III, closed on €231m in March 2012, surpassing its target of €200m but downsizing from the GP's previously largest vehicle, SSVP II, which closed on €255m in December 2006.

Investors
The fund was oversubscribed due to significant support from existing investors, as well as interest from new investors, according to a statement. There are around 10-12 institutional LPs in the fund, of which three or four are first time investors in an Orlando fund and two are from different geographies than the fund's traditional investor base, according to a source close to the situation. German asset manager Integra and Norwegian insurance company Kommunal Landspensjonskasse are known to have invested in Orlando's previous funds. Investors in the new fund include endowments, foundations, insurance companies and family offices from Europe, the US, Israel and Japan.

Investments
ESSVP IV will target acquisitions of industrial companies in the DACH and Nordic regions with revenues of up to €500m. It will buy mostly profitable companies with a healthy core, but which are in a situation of underperformance or fundamental transition. The fund has not yet completed any transactions, but the pipeline is said to be healthy. It will run a five-year investment period.

According to a press release, typical causes of special situations include past unproductive capital expenditure, uncontrolled expansion, insufficient cost control, unresolved succession problems, gridlock between management, shareholders and banks, and carve-out situations.

People
Orlando Management – Henrik Fastrich, Georg Madersbacher (founding partners).

Advisers
Equity – MVision Private Equity Advisers, Mounir Guen (placement agent); Clifford Chance, Sonya Pauls (legal); Flick Gocke Schaumburg, Christian Schatz (legal).