MCH reaches first closing for third fund

01 August 2008

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Fund

MCH has held the first closing of its fund MCH Iberian Capital Fund III on EUR225m. The EUR300m vehicle has a hard cap of EUR350m and is set to reach its second and final closing before the year's end. The fund has a 5+5 structure with a possible two-year extension period. Based in Spain, minimum subscriptions have been set at EUR5m with the GP contributing 1.5% to the fund. Management fees, carry and hurdle are set at industry standards; the carried interest will be paid on the fund as a whole. Restrictions to the fund pertain to real estate, the finance sector, GMOs and defence among others. SJ Berwin has been retained as legal adviser to the fund.

MCH Iberian Capital Fund I generated returns of 2x net money multiple for investors while Fund II forecasts place returns for the current vehicle above 3x.

Investors

The investor base is made up of banks, pension funds, insurance companies and family offices, with 10% of the investors coming from Spain and 90% originating in other European countries. Returning investors include French bank Natixis and Quilvest, a Luxembourg-listed company.

Investment

The fund focuses on both buyouts and growth capital deals in the Iberian mid-market companies in deals ranging between EUR15-50m and targeting majority stakes, although in some instances significant minorities will be considered. The vehicle will seek to complete 10 investments. Co-investments are a possibility and will be assessed on a deal-by-deal basis; four investors have manifested interest which would increase the equity allocation available to up to EUR70m. Exit strategies have not been pre-defined.

Name: MCH Iberian Capital Fund III

1st closing: EUR225m

Focus: Iberian buyouts, generalist

Contact: Jaime Hernandez Soto

Address: MCH Private Equity, Plaza de Colon 2, Torre I, Planta 15, 28046 Madrid, Spain

Tel: +34 91 426 44 44

Fax: +34 91 426 44 40

Advisers: SJ Berwin (Legal).