Bridgepoint extends Europe VII fundraising timeline to tap 2024 allocations

The fund has raised EUR 6bn against its EUR 7bn target, it said.

The firm said in its both its H1 2022 report and its FY 2022 trading update, that it was on track to close the fund in H1 2023, with the GP expecting some of its LPs to use their 2023 allocations to commit to the fund. At the time, the fund was expected to hold a second close in Q1 2023, having begun its investment period in May 2022.

Bridgepoint Europe VII received commitments of EUR 500m over the course of Q2 2023, it said, bringing it in line with the size of its EUR 5.7bn, 2017-vintage predecessor.

The vehicle has committed 18% of its primary capital to date, it said.

The fund has attracted “major new Limited Partners from Asia and EMEA”, chairman William Jackson said in the report.

Its other fundraising activity includes Bridgepoint Credit Opportunities IV and Bridgepoint Growth II, both of which are expected to close in the next 12 months, it said. It also plans to launch its next Credit Opportunities and Direct Lending vehicles within the next 12 months, having announced the final close of Bridgepoint Direct Lending III on the same day as it issued its half-year report. The GP raised EUR 3.4bn for the strategy across the fund and separately managed accounts.

The firm’s capital deployment is on track for 2023, with EUR 1.7bn invested in H1 2023 versus EUR 3.1bn in H1 2022, it said.

Slow and steady?
The extended fundraise highlights the problems that many GPs are experiencing in getting their fundraising goals over the line. The denominator effect has significantly impacted LPs’ ability to make commitments to private markets in 2022 and 2023.

While large-cap fundraises have seen success this year – most notably CVC’s latest EUR 26bn buyout fund – some sponsors in a similar size bracket to Bridgepoint have struggled. These include France-headquartered Astorg, which has cut its fundraising target from EUR 6.5bn to EUR 4.5bn, as reported.

Some GPs have set a flatter target than might have been expected in a previous market, including Triton, which is aiming to raise EUR 5.5bn for its current fund versus the EUR 5bn it raised for its 2018-vintage predecessor, as reported.

Exits on the horizon
With private equity exits at their lowest point since 2009, the lack of distributions to LPs has limited their liquidity, further compounding fundraising issues.

Bridgepoint has seen this trend play out in its portfolio: investment income fell by two-thirds (67%) year-on-year, from GBP 38.7m in H1 2022 to GBP 12.7m in H1 2023, in part due to lower exit activity. Although its investment income expectations for 2023 remain unchanged, they are now weighted towards H2 2023 and 2024, it said.

Although Bridgepoint has made exits from eight out of the 14 portfolio companies held in its 2014-vintage Bridgepoint Europe V, it has made just one partial realisation from the 16 investments held in Fund VI, according to Unquote Data.

The latest exit from the Bridgepoint Europe strategy was dialysis business Diaverum, which it sold to Mubadala-backed M42 in April 2023, having held the business in its EUR 2.5bn, 2005-vintage third Europe fund since 2007.

Prior to this, the GP sold testing, inspection and certification business Element Materials Technology (held in Fund V) to Temasek in a EUR 7bn secondary buyout in January 2022, netting a 3.7x money multiple and a 30% IRR.

The GP is currently working on a number of potential exits from its private equity portfolio, according to Unquote sister publication Mergermarket.

The GP is currently weighing exit options for Germany-based automotive supplier ACPS Automotive, as well as Portugal-based sustainable agriculture business Rovensa, which is held in Bridgepoint Europe VI. Fellow Fund VI portfolio company Qualitest, a software testing company, was previously tipped to come to market this year, as reported by Mergermarket.

The firm’s recent buyside activity includes the acquisition of SK Aerosafety from Levine Leichtman Capital Partners following a competitive process. The firm deployed capital via its GBP 1.5bn, 2020-vintage fourth Development Capital fund which typically acquires lower mid-market businesses with enterprise values of GBP 30m-GBP 150m, according to Unquote Data.

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