NorthEdge's SME Fund I closes on £120m

Francesca Veronesi
09 July 2018

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NorthEdge Capital has held a first and final close for NorthEdge Capital SME Fund I т dedicated to the North of England and Midlands regions т hitting its ТЃ120m hard cap.

The vehicle was originally targeting a £100m close.

Houlihan Lokey acted as the exclusive placement agent for the fundraise. The vehicle was launched in February 2018.

The fund's predecessor, NorthEdge Capital Fund II, which closed in 2016 on £315m, is providing equity tickets in the £10-45m range. The vehicle invested around £150m in 11 companies since the first investment was made in June 2016.

A spokesperson for NorthEdge disclosed that with larger funds being raised on average, small-cap investments seem to attract fewer GPs, and that a NorthEdge small-cap vehicle promises a good dealflow.

Earlier in May, NorthEdge hired Keven Parker and Andy Tupholme as portfolio directors.

Investors
A group of UK-based and international institutional LPs that had already made commitments to NorthEdge vehicles have backed NorthEdge Capital SME Fund I.

According to Unquote Data, the following LPs have committed to the vehicle: asset manager MLC (Australia); insurance company Industriens Pensionsforsikring; foundation Realdania (Denmark); PE firm Certior Capital (Finland); pension fund Stichting Shell Pensioenfonds (Netherlands); private equity firm Unigestion (Switzerland); fund-of-funds manager Pathway Capital Management; pension funds Shell Overseas Contributory Pension Fund and West Yorkshire Pension Fund (UK); pension funds Public Employees' Retirement System of Nevada and The Public School and Education Employee Retirement Systems of Missouri (US); and insurance company Travelers Casualty and Surety Company (US).

Investments
SME Fund I targets businesses across all industry sectors in the North of England and Midlands region, providing equity tickets in the £2-10m range for growth and development capital, management buyouts, equity release and buy-and-build transactions.

A spokesperson for the firm confirmed the vehicle is yet to begin investing.

People
NorthEdge Capital, Grant Berry (managing partner).