Alcedo heads for June final close for Fund V

Alcedo V has amassed EUR 230m in commitments to date, having held a first close on EUR 153m in September 2021. The fund has a hard-cap of EUR 250m, they said.

Acanthus Advisers acted as placement agent, while Proskauer and Legance provided legal advice.

Gallo said that the European Investment Fund is the fund’s cornerstone investor.

Fund V is also backed by international funds-of-funds, Italian pension funds, family offices, corporate investors, banks, and high-net-worth individuals, they said.

Fund IV, which held a final close on EUR 195m in May 2016, is fully deployed and is now only making add-ons, according to Gallo. It has only made one exit to date, with the sale of Duplomatic last month, and expects another exit to be announced before next summer, Gallo said.

Fund V has made one investment to date, acquiring Scatolificio Gondola, a Venice-based packaging company, in April 2022. It is expected to target two to three direct platform investments per year and one to two add-ons. It will target 12-13 platform investments overall.

The vehicle has a sector agnostic approach, but Alcedo has a track record of investing in the food industry. The vehicle will back North and Central Italian SMEs with EUR 10m-200m in turnover, while the sponsor’s sweet spot is within the EUR 20m-70m range. It is particularly interested in family-owned businesses with strong growth potential, Gallo said.

Resilient markets
Alcedo will continue with its traditional investment strategy, they said. Fund V will seek niches in the Italian economy. The sponsor likes companies that are in resilient markets and can overcome challenges like Covid-19. The food and cyber security sectors have been resilient, according to the partners, adding that they are seeking opportunities in those sectors. The sponsor also finds food supplements an interesting area and said it is growing rapidly in Italy. It will also invest in markets where it is experienced like mechanics, specialty chemicals, B2B, and B2C services.

The new fund deploys equity tickets of EUR 10m-30m with an average size of EUR 15m. Around 90% of the fund is dedicated to new investments, while the remainder is reserved for add-ons.

It will hold portfolio companies for two to six years, with an average holding period more likely to be between four and five years, depending on how long it takes to build up value, said Gallo. The vehicle can make minority and majority investments but has a preference for acquiring a majority stake.

Alcedo IV made only one minority deal out of its 10 investments, while Alcedo III made four minority deals out of its 10 total investments, Gallo said.

Buy-and-build is an important part of Alcedo’s strategy as well as supporting top-line growth, said Gallo. Companies in Alcedo IV have so far completed seven add-ons, he added.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Fundraising
• Southern Europe
• Buyout
• Italy
• Alcedo SGR