Mandarin Capital holds €148m first close for MCP III

MCP III expects to hold a second close in early 2020 and a final close by June 2020.

Mandarin was advised on the fundraising by Lancea and Cebile Capital, both headquartered in London.

The new vehicle will follow the same strategy as its predecessor, Mandarin Capital Partners II, which closed on €195m in 2016 and is now fully deployed. The vehicle completed eight investments, five of which were fully divested, and has returned 39% IRR and 2.2x contributed capital to its investors.

Investors
The fund has raised commitments from new and existing LPs, primarily Italian family offices, high-net-worth individuals and pension funds, including Inarcassa and Fondo Pensione Agenti Professionisti di Assicurazione, Unquote understands.

At this stage, 70% of the investors are Italian, while the remainder of the capital comes from outside Italy, primarily from the UK, France and the US. International LPs include HQ Capital, LGP, two American investors and one Middle eastern family office. In addition, the GP made a significant commitment to the fund. Mandarin expects capital from international LPs to make up around 70% of the capital for its second close.

Investments
The fund intends to support export-orientated companies able to sell around 60-70% of their production abroad and capable of further boosting their international expansion in Europe, Asia and the Americas.

It will target companies with EV in the €30-70m range and EBITDA of €3-7m, operating in a wide range of sectors, including mechanical engineering, chemicals, cosmetics and food. It will invest primarily in Italy, but may also deploy a portion of its capital in Swiss and German businesses.

MCP III will deploy equity tickets of €15-20m and will follow up with additional capital injections to finance a buy-and-build strategy up to €30m per portfolio company. It will apply moderate leverage of around 2-3x EBITDA.

The fund expects to make its first two investments next month in the coffee capsules and luxury bags sectors.

People
Mandarin Capital Partners – Lorenzo Stanca (partner).

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