Nordic Capital raises €1.2bn for first mid-market fund

Eliza Punshi
01 July 2021

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Nordic Capital has held a first and final close for itsТ first mid-market vehicle at slightly more than тЌ1.2bn.

The GP launched the fund in April 2021 and took three months to raise the vehicle. The fund will target mid-market companies across Northern Europe.

The final close comes nine months after it closed its main buyout vehicle, Fund X, on €6.1bn in October 2020.

Nordic Capital said the fund was "substantially oversubscribed at its hard-cap and significantly exceeded its target". The GP's own commitment to the fund was 6.8%.

Rede Partners acted as the placement agent, while Kirkland & Ellis – supported by Carey Olsen and Arendt & Medernach – provided legal advice for the fundraise.

Several large-cap and international players have launched mid-cap funds in recent months, or are in the process of raising one, to complement and extend their existing strategies, as Unquote recently explored.

This includes Astorg, which is on the road for its first mid-market fund, Astorg Mid-Cap; the GP expects to hold a final close this summer. Earlier in the year, Triton held a final close for Triton Smaller Mid-Cap II on €815m, and PAI Partners held a final close on €920m for its debut mid-market fund.

Investors
LPs in the Evolution Fund include investors from across the globe, with 57% of them from Europe, 19% from Asia, 19% from North America, and 5% from the Middle East.

The investor base is made up primarily of institutional investors, with around 40% asset managers and advisers; around 30% public and private pension funds; around 20% sovereign wealth funds, and roughly 10% endowments and family offices.

The GP said the fund saw strong interest from its existing investors.

Investments
The new fund will focus on the mid-market space, and be used to acquire controlling stakes in non-cyclical companies within Nordic Capital's core focus areas of healthcare, technology, payments and financial services.

The GP will make equity investments across northern Europe of €35-150m in companies with enterprise values of €50-300m.

The new fund already has a strong deal pipeline, the GP said. The first portfolio company in the Evolution Fund was Boost.ai, a Norwegian developer of an artificial intelligence and virtual assistant platform for companies. The deal was completed in April 2021.