Sagard's third fund reaches €800m

Alice Tchernookova
13 January 2017

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Private equity house Sagard has amassed a further €300m for its third buyout fund Sagard III, doubling its size after re-opening for subscriptions last year.

Launched in 2013, Sagard III reached €500m in commitments that year. In 2016, however, the GP decided to re-open the fund for subscriptions in order to keep broadening its portfolio, Capital Finance recently revealed. Sagard has another four years to deploy Sagard III.

The fund's previous generation, Sagard II, closed on €1.01bn in 2006. However, due to difficulties with the fund's deployment, it subsequently had to be reduced to €800m in 2010 and got an extension for its investment period. The fund should bring its investors a return of around 1.7x, according to the GP. Successful investments made with the fund included Ceva Sante Animale, Eurodough, Fläkt Woods Group and Stokomani, according to unquote" data.

Investors
Structured as an evergreen fund renewable every year, Sagard III launched in 2013 thanks to a commitment reaching €500m by the firm's historical family sponsors – Paul Desmarais, and Albert Frère via the Bruxelles Lambert group.

The fund's current extension was completed thanks to the commitments of an extra 20 LPs, the GP confirmed. Those came from institutional investors based in Europe for the most part.

Investments
According to the GP, Sagard III's investment strategy is very much in the continuity of Sagard I and Sagard II, typically targeting companies with a turnover in the €100-300m range, with equity tickets ranging between €50-100m.

A few transactions have been completed with the fund since 2013. In 2013, the GP took a minority stake in online insurance broker Santiane, which it subsequently exited in 2015 in a sale to BlackFin Capital Partners. In 2015, it took a stake in air transportation equipment group Alvest, taking over from LBO France in a tertiary buyout. Other investments included Safic Alcan, Grand Frais and Les Délices des Sept Vallées.

Sagard does not exclude co-investment opportunities, having previously acted as minority investor alongside Siparex, Five Arrows and others.

People
Sagard – Antoine Ernoult-Dairaine; Frédéric Stolar (partners).