Nexxus holds first close on €130m for first Spanish fund

The fund was announced in April 2016 but fundraising picked up momentum after the GP opened its Spanish office in December 2016, unquote" understands. It first started approaching international LPs in March 2017.

Nexxus has been active in the Mexican private equity market since 1995 and recently launched its seventh Mexico-focused buyout fund with a target of $550m.

The Iberia team will be able to draw on the support and experience of the Mexican operation, using its back office and fund administration capabilities. There will also be a joint investment committee, and partner Alejandro Diazayas will act as the link to the Mexico operation, where he worked for more than 20 years.

Nexxus Iberia managing partner Maite Ballester said: "Investors took comfort in the fact that although Nexxus Iberia is raising its first fund, the partners have been working together as a team for close to two decades doing many transactions in Spain." Ballester and the third partner at the Madrid office, Pablo Gallo, previously worked together at 3i.

Two placement agents have been employed to manage the fundraising process. Xavier Tintore from Impulsa Capital is responsible for the Spanish side of the raise while Louis Trincano of Cornerstone Fund Placement is heading up the wider European fundraising effort in London.

The fund has a 10-year lifespan and five-year investment period, with market-standard management fees and carry structure. Legal advice was provided by Ildefonso Alier and Isabel Rodríguez at King & Wood Mallesons.

Investors
According to Ballester: "Investors at first close are mainly European institutional investors that understand private equity very well and thought that the focus on small and mid-cap companies in Spain (with the idea of supporting them in their international growth, notably in Latin America) was compelling and differentiated."

The European Investment Fund is the vehicle's anchor investor and the fund also has a €39.5m commitment from Spanish state-backed fund-of-funds Fond ICO Global; however, this amount is contingent on the raise hitting its €200m target. Other LPs include Banco Sabadell and an assortment of Mexican and Spanish family offices.

Investments
The fund will target investments in Spanish companies with €5-10m EBITDA across a range of sectors, and which have the potential to be scaled and expanded into Mexico and the US. It has the flexibility to take majority and minority stakes and will use leverage, although this is unlikely to exceed 2x on the majority of deals. It will make 8-10 investments in total in companies with enterprise values of between €40-100m.

"Now that we have an active fund, we will be able to start doing deals as we resume with our fundraising. We expect to be announcing a first deal in the coming quarter," Ballester added.

People
Nexxus Iberia – Maite Ballester (managing partner); Alejandro Diazayas, Pablo Gallo (partners).

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