Australia’s PEP closes Fund V at A$2.1b

The fund launched in May 2013 with a target of $2 billion and had a first close of around A$1 billion in mid-2014. It follows PEP Fund IV, which closed at A$4 billion in 2007. That sum included A$1.3 billion in non-discretionary co-investment capital allocated to deals on a pro rata basis. For Fund V, co-investment is discretionary, though limited to a relatively small group of institutions.

Co-investments from Fund IV include Spotless Group. The cleaning and catering contractor was taken private in 2012 at an enterprise valuation of A$1.1 billion, with the fund taking a 72.5% stake and co-investors holding 20.6%. The company was refinanced in 2013, re-listed last year - raising A$994.6 million in its IPO - and PEP and its co-investors completed their third and final sell-down in August.

Since May of last year, PEP has also sold: Peters Ice Cream to UK ice cream company R&R, snacks maker Griffin's Foods to Universal Robina of the Philippines, cinema chain Hoyts Group to China-based Wanda Cinema Line, and distributed power provider Energy Developments to Duet Group. There were also IPO exits from Asaleo Care and Veda Group.

Set up in 1998, the private equity firm targets underperforming market-leading businesses with enterprise values of A$250 million to A$1.2 billion. Recent acquisitions include New Zealand-based education provider Academic Colleges Group, health foods business Manuka Health New Zealand, and the Australia-based bakery unit of Kerry Group.

Fundraising by Australia and New Zealand-based managers stands at A$2.46 billion so far this year, according to AVCJ Research. It trails the $4.11 billion raised in 2014 as a whole - which includes PEP's first close - but is more than any other year since 2010.

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• Topics
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• Pacific Equity Partners
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