Pencarrow IV Fund closes at $124 million

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Pencarrow IV Fund closes at $124 million

Pencarrow Private Equity has raised a $124 million fund – its fourth and largest fund – to invest into privately owned New Zealand companies.

The Pencarrow IV Fund completed its final close with committed capital of $124 million. It includesa cornerstone $30 million commitment from the New Zealand Superannuation Fund, alongside investment from a range of other New Zealand institutions and private investors.

Nigel Bingham, Pencarrow’s Executive Director, said the focus of the fund will be on investing in management buyouts, succession deals and expansion capital opportunities among privately held companies in the mid-market segment in New Zealand. “This is an ideal environment to be looking for new investment opportunities. There is considerable opportunity for established, medium sized New Zealand companies which have weathered the slowdown of the past few years and are now looking to grow their business.

“We typically make investments in companies with enterprise values ranging from $20 million to $100 million. There are a number of quality opportunities in the New Zealand market, especially in companies looking to expand. With the recent recovery in global financial markets, but ongoing uncertainty in Europe and the USA, the New Zealand private equity opportunity is an attractive one for institutions and private investors.

“The target companies for the new fund will have proven business models and profitable track records, and will usually require capital to achieve further growth, expand internationally, or assist with ownership succession.”

Mr Bingham said the successful capital raising showed there is investor confidence in opportunities in privately-held New Zealand companies.

“All of Fund IV’s commitments have been raised from New Zealand investors and we have been delighted by the response from local investors to our offering, especially considering the current fund raising environment.

“Pencarrow has an experienced team and a proven track record of successfully backing companies able to create value through growth and transformation. Our objective is to invest into businesses with real potential and then help them to grow.

“Pencarrow is New Zealand’s longest established private equity firm. Despite the global financial crisis, our previous fund achieved a strong performance with very high levels of cash returns for investors. We are confident of similar success with the Pencarrow IV Fund given the current investment environment and opportunities,” Mr Bingham said.

About Pencarrow Private Equity
Pencarrow is New Zealand’s longest established private equity manager, having established its first fund in 1993. Since then, Pencarrow has been making and managing private equity investments in businesses in New Zealand. It has have invested more than $225 million in 25 companies.

Pencarrow is jointly owned by Nigel Bingham and Rod Gethen. It is focused on investing in and adding value to small to mid-market businesses in New Zealand, specialising in MBOs and expansion capital for companies across a range of industries.

Previous successful investments have included BJ Ball, New Zealand’s leading fine paper merchant which has successfully expanded into Australia, and Phil & Teds, one of the world’s leading designers and marketers of premium infant hard goods.

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