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Several funds seeking to close in H1 face delays, says Cebile

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Although the impact of the coronavirus outbreak on fund closes is hard to gauge for now, LPs' reluctance to commit is likely to lead to a number of delays come Q2, according to a recent report by Cebile Capital.

The placement agent noted that the market was currently bifurcating sharply between funds that are within reach of their targets – and therefore accelerating in order to cross the finish line before the situation potentially gets even harder to navigate – and those that are still some way off their goals. The latter are increasingly choosing to postpone closings until the end of Q3, according to Cebile.

The impact is hard to quantify at this stage and is likely to become clearer in Q2, the firm said. Of the 81 European funds it tracks as targeting an H1 2020 close, Cebile recorded that around 68% have already been executed or confirmed as going ahead as planned. The percentage of officially delayed closes is still low, at 2%.

But Cebile noted that LPs are "postponing investment decisions, or putting new commitment allocations on hold, until they have greater clarity on the contingent crisis". It therefore expects that around 80% of LPs are now putting commitments on hold, which may lead to up to 40% of funds currently in the "expected close" category crossing over into "delayed" as Q2 rolls in.

Meanwhile, a number of funds are also on the road following a recent launch, or were expected to come to market this year, according to Unquote Data, and could therefore face delays too:

Newly launched and upcoming European fundraises

Fund name Fund manager Focus Fund target Status
Axcel VI Axcel Nordic mid-cap n/d Open
Sagard IV Sagard Buyout €800m Open
PAI Mid-Market PAI Partners Mid-cap €600m Open
CVC Capital Partners VIII CVC Large-cap €17-20bn Open
EQT IX EQT Buyout €14.75bn Open
DBAG Fund VIII DBAG DACH €1.1bn Open
NorthEdge Capital Fund III NorthEdge UK n/d Pre-launch
Montagu VI Montagu Buyout €3bn Pre-launch
Activa Capital IV Activa Capital French mid-cap €200m Pre-launch
Sovereign Capital V Sovereign Capital Buy-and-build £500-600m Pre-launch

For complete listings of funds currently on the road or due to launch soon, head to www.unquotedata.com

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