Montana Capital Partners closes OSP V on €1.3bn

The vehicle was registered in February 2020, according to Unquote Data. The fund was announced in April 2020 and closed in December 2020. The GP said in a statement that the fundraising process took eight months and that the process was oversubscribed.

Clifford Chance provided legal advice on the fundraise. The GP did not work with a placement agent.

The GP's predecessor vehicle, MCP OSP IV, held a final close in April 2018 on its hard-cap of €800m, surpassing its target of €650m.

The firm was able to continue to make deals in 2020 in spite of the coronavirus pandemic, managing partner and co-founder Marco Wulff told Unquote: "We have been relatively active during Covid – the uncertainty in the market could have meant dealflow died down, but the contrary was the case: we saw a few interesting opportunities and were able to close these, so we were actually above our regular investment pace. We want to consistently invest without peaks, so there is no concentration risk with regard to timings."

Alongside the announcement of the new fund, MCP also expects to increase its team size, Wulff said. "We increased our team from 20 to 25 people over the last few months and intend to expand on all hierarchy levels."

Investors
The fund has around 40 LPs, MCP said in a statement, comprising sovereign wealth funds, pension funds, insurance companies, family offices and foundations. The LP base includes institutions from Europe, Asia, the Middle East and the US. The GP has committed 2% of the fund's target volume of €1bn. The average LP commitment was around €35m.

LPs in MCP OSP IV include insurance companies such as Deutsche Rückversicherung and Zurich Life Assurance, as well as the London Pensions Fund Authority, according to Unquote Data.

Investments
The fund will make both LP stake deals and GP-led transactions, as well as direct co-investments, single fund stakes, small portfolios and funds-of-funds stakes, MCP said in a statement. 

"We will aim to make 45% of our deals in the US and 45% in Europe, with 10% invested in the rest of world," Wulff told Unquote. "We target small, mid-cap and large buyouts, as well as growth funds, although we are more reluctant when it comes to venture capital."

Wulff confirmed that the fund will follow the same strategy as its predecessors, but with more opportunities to invest in larger deals. "We have always focused on our segment, which is the small end of the market and deals below €50m. We can increase the number of transactions with the new fund, but this also gives us the flexibility to do larger transactions."

"We acquired a larger portfolio with GIC from Ping An last year using Fund IV and Fund V, and, with the new fund, we have more flexibility for larger transactions," Wulff said. In October 2020, GIC and MCP acquired a portfolio from the Chinese firm valued at $875m. OSP V is now around 10% deployed.

People
Montana Capital Partners – Christian Diller, Marco Wulff (managing partners, co-founders).

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