Q Group launches Made in Italy fund, inks first deal

Alessia Argentieri
01 October 2018

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Private equity house Q Group, in partnership with advisory firm Pambianco Strategie d'Impresa, has launched Made In Italy Fund, a new vehicle targeting Italian SMEs.

Unquote understands that the vehicle was launched in January 2018 with a €200m target, held a first close in March on €100m and expects to reach a final close by June 2019. It is domiciled in Luxembourg and has a net IRR target of 20%, with an industry-standard 10+1+1 lifespan.

The GP is led by co-CEOs Walter Ricciotti and Alessandro Binello, who previously held the positions of Quadrivio Capital CEO and president, respectively, until November 2017, when the Italian GP was acquired by Green Arrow Capital. They will be joined in the fund's management by Pambianco CEO David Pambianco and managers Alessio Candi and Mauro Grange.

Made in Italy closed its first deal last week by acquiring a majority stake in Palladium Moda, an Italian company founded in 1986 that specialises in the fashion industry and owns the 120% Lino brand. The business has seven mono-brand shops, two located in Milan and five in Florida, the US.

Unquote understands that the fund acquired a 70% stake in the business in an all-equity deal from the company's founder and CEO Alberto Peretto, who retained the remaining 30% holding. Palladium Moda generated an EBITDA margin of 18% from revenues of €12m in 2017, 40% of which came from the US, and expects to reach a turnover of €36m by 2022.

Made in Italy was advised by Studio Legale Pedersoli, Pavia & Harcourt and EY, while Palladium Moda was advised by Cremonini & Associati, Studio Legale Cugini and Cartwright Pescatore.

No placement agent is being used.

Investors
Made in Italy Fund's LP base is mainly composed of Italian and international pension funds, funds-of-funds and family offices.

Investments
The vehicle plans to acquire majority stakes in Italian SMEs operating in the fashion, design, beauty and food industries, with annual revenues of €10-50m. It will deploy equity tickets between €10-20m and follow a conservative approach to the use of leverage in its transactions, not exceeding 3x EBITDA.

The fund will make 10-12 platform investments; the fund has reviewed around 85 opportunities since the beginning of 2018 and could announce a further deal in early 2019.