Launch of Private Equity Fund Delayed
1 December 2008
Waning Investor Confidence Delays Launch of Private Equity Fund
Hamilton-based private equity fund, Central Capital Regional Fund LP, announced today that the scale of the global financial crisis and its impact on investor confidence and liquidity in New Zealand and elsewhere has caused directors to delay the fund’s launch.
The new fund was announced in August. It was seeking to raise $50 million within 12 months and aims to address the need to provide equity capital and expertise to provincial North Island growth companies.
Central Capital CEO, Rory MacGillycuddy, says the backdrop of deteriorating domestic and international economic conditions has led some potential investors to delay or reduce their commitments to the fund.
“Our management team believes that it is prudent to suspend fundraising until the second quarter of 2009 when hopefully conditions will be more stable and investors are more confident in investing.
“However, this suspension does not signal an end for Central Capital. It is simply an unexpected delay that is, unfortunately, due to worsening economic conditions beyond our control.
Mr MacGillycuddy says Central Capital believes its fund model is viable and that founders, John Birch and Gary Mollard, remain committed to the concept as directors and material investors.
“During the last few months we have assembled a skilled team and infrastructure to promote regional growth, deliver on the promise of companies throughout the North Island and provide significant returns to investors.
“We have received strong endorsement from business owners, advisers and potential investors and we have been immersed in deal flow of some very exciting companies,” explains Mr MacGillycuddy.
Central Capital has contacted investors who committed to the fund and are contacting recipients of information memorandums to advise them of its delay to first close.
Existing transactions that Central Capital has been pursuing will be assisted, wherever possible, to find compatible investors. With the respective shareholders’agreement, some transactions will be deferred until fundraising is completed later next year.