FSN closes sixth fund on €1.8bn

The GP exceeded its target of €1.5bn for the fund, which was oversubscribed. It started fundraising in July last year. It held a first close in July and two interim closes in December 2020 and Q1 2021.

FSN's previous fund became fully deployed in Q4 2020 and the GP has already started deploying the sixth fund. 

The GP told Unquote that its commitment to the fund had not been finalised yet, but that it expected it to be 3-4% of the total €1.8bn.

UBS acted as sole global placement agent, and Kirkland & Ellis International was the legal adviser for the fundraise. 

Morten Welo, partner and head of investor relations at FSN, told Unquote that fundraising had taken the GP a bit longer due to Covid-19, but the GP achieved a better result than previously expected: "Between first close and final close, there was a slowdown when LPs looked at what was actually going on with regard to the pandemic. But as new LPs became familiar and comfortable with virtual fundraising from November 2020 onwards, fundraising was very strong." 

Investors
The GP told Unquote that there are roughly 100 LPs in the new fund, featuring a global investor base and commitments from a strong number of pension funds, endowments, insurance firms and local banks, as well as sovereign wealth funds.

Investments
FSN Fund VI will be used to make 14-16 platform investments in companies across three core sectors: manufacturing, consumer and business services. 

In addition to the core sectors, Welo said the GP pursues thematic sourcing: "We look at what the interesting mega-trends are out there and how that will impact companies, and you will see interesting pockets based on that. This has led to our first deal in renewables, in the seventh largest solar plant developer in Europe, and our second investment in Omegapoint, an IT consultant specialised in cybersecurity. The mega-trends are important for us to look at, and the digitalisation of our societies, as well as climate change, are two of them."

He added, however, that the GP's key investment criteria had remained unchanged. "Our strategy has remained the same, which we know our LPs appreciate. We have two key investment criteria: one is to see the opportunity to double EBITDA in the four- to six-year holding period; and the second is that we shy away from beta risk, meaning things which we cannot control, such as commodity risk, FX risk, political risk, etc. For instance, despite being in Norway for more than 20 years, we haven't done any deals in oil-related investments due to the beta risk." 

The GP has already made two investments from the fund, namely Danish company Obton Group, and IT company Omegapoint. 

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