Apax tech disposal marks venture exit

This weekend, Apax announced it had sold its portfolio of 16 early-stage technology companies to Azini Capital's fund, Azini 2 LLP. Though the value of the deal is not know, Azini had received $100m from Lexington Partners to fund the transaction and support portfolio companies.

The deal marks the end of Apax's presence in the European venture capital market. Despite once being a major growth investor, the company has moved away from venture and growth capital and is now firmly rooted in Europe's buyout market. Buyout giant 3i has made similar moves already, disposing of much of its venture portfolio last year.

Though it had been expected for some time, Apax's exit from venture investing will come as a blow to an already fragile early-stage market in Europe. Many venture funds have already struggle to raise capital during the recession, with some markets reduced to just a few active players, and poor stock market conditions have hit the IPO market, which has often provided the best returns for early-stage investments.

While Europe has always lagged behind the highly active US venture market, which focuses on Silicon Valley for tech-based funds, it has also recently come under pressure from developing markets. With India and China grabbing so much interest from LPs and GPs alike, European venture has perhaps come to seem somewhat less glamorous.

As well as picking up a range of technology companies, including a developer of paper-thin batteries and a shockproof mobile phone manufacturer, Azini will also gain some of Apax's experience. Peter Skinner and Gal Hayut will join Azini from Apax, having played a major part in running the companies.

Apax still holds on to some parts of its more mature technology and biotechnology companies, but these too are likely to be sold at some point. Despite an improving economic picture, 2010 has been a difficult year for venture, both in terms of deal activity and publicity. The venture community will hope an improvement in stock markets will increase the appetite for early-stage investment in Europe.

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• Topics
• UK / Ireland
• Southern Europe
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• France
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• Early-stage
• Apax Partners
• 3i