Eurazeo holds a €2.5bn final close for Eurazeo Capital IV

Launched in Q4 2018, Eurazeo Capital IV held a first close on €500m in January 2019 and has now hit its €2.5bn hard-cap. 

Out of the total amount raised for the fourth-generation fund, Eurazeo provided €1.8bn via its balance sheet, while third party backers committed €700m. 

The vehicle's predecessor, Eurazeo Capital III, closed on €2bn, with Eurazeo committing €1.5bn and third-party investors providing €500m, Unquote understands.

The GP's balance sheet is currently approximately €6bn, Unquote has learned. Eurazeo Capital II, III and IV were raised using capital from both the group's balance sheet and third-party investors.

Campbell Lutyens acted as a placement agent, Unquote understands. 

Investors
Institutional investors, including asset managers, sovereign wealth funds, insurance companies and family offices, have backed the vehicle. LPs are based in North America (51%), Europe (36%), and Asia (13%). Expanding its international base and welcoming US LPs specifically was a top priority for the GP, a person familiar with the situation told Unquote at the time of the fund's first close. Indeed, the fundraise has welcomed a higher number of US-based investors than Eurazeo Capital III, Unquote has learned. 

LPs backing the fund are open to co-investments and a number of Eurazeo Capital IV's investments could be of this sort.   

Investments
The fund targets European and US-based mid-market companies, writing equity tickets of €200-400m to back businesses with valuations of €500m-1bn. If co-investments are arranged, the EV of a portfolio company could be higher.

Companies will be operating in the consumer, business services (including the financial and software sub-sectors) and healthcare sectors.  

Around 60% of targets will be headquartered in Europe and 40% in the US. 

Eurazeo Capital IV was used for the investment in Netherlands-based Dutch Ophthalmic Research Center (DORC); the deal was completed in March this year. The GP invested €300m in this transaction, drawing €75m from the vehicle and €225m from its balance sheet, Unquote learned at the time. DORC was the fund's fifth investment, according to a statement by the firm.

All of the fund's investments will use equity from third parties, as well as from Eurazeo's balance sheet, as was the case of DORC, Unquote understands. 

Previous investments completed via Eurazeo Capital funds in Europe include Spain-based Iberchem and France-based Albingia. In the US, the funds backed Trader Interactive and Worldstrides.

People
Eurazeo – Marc Frappier, Frans Tieleman (managing partners).

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