Five Arrows Secondary Opportunities V closes on €1bn

The fund was launched in Q1 2019, according to Unquote Data.

Rothschild's secondaries team, made of 16 investment professionals, started to expand into the US with the hire of a senior investment professional earlier in 2019; the new executive is based in its New York office. The US team will further grow during 2020.

The vehicle's predecessor, Five Arrows Principal Investments IV, closed on €451m. It made 15 investments and committed 127% of the fund by recycling returns to maximise the impact for portfolio companies. A source familiar with the situation confirmed to Unquote that recycling in Faso IV occured due to liquidity events from companies bought within a secondary transaction, which took place during the investment period. Recycling only took place on the invested cost of any realisations, not the profits.

No placement agent was used for the fundraise, Unquote has learned from the same source. 

Rothschild Merchant Banking's assets under management amount to €13bn across four strategies: corporate private equity; senior and junior credit; primary and secondary fund investing; and co-investments. Five Arrows Principal Investments, the private equity arm of the group, closed Five Arrows Principal Investments III on its €1.25bn hard-cap in Q1 2019. 

Investors
Institutional LPs, corporates, family offices and entrepreneurs backed the fund. 

The Rothschild family, alongside the Rothschild & Co group and senior executives of the firm (who collectively are the fund's investor), also made a substantial commitments, the same source told Unquote. 

Investments
The focus of Faso V's investment strategy continues to be on secondary direct investments (or GP-led deals), predominantly in the European small-cap and mid-market. Secondary directs can take several forms, such as fund restructurings or spin-outs, and are typically initiated by a GP. Faso V provides equity tickets in the €10-100m range, with the ability to commit significantly larger amounts when co-investing with its LPs.

More than 30% of Faso V was committed at the time of the final close.

People
Rothschild & Co – Marc-Olivier Laurent (executive chairman); Mireille Klitting (Faso managing partner).

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