Palatine raises £220m for biggest-ever fund

PALATINE Private Equity, the Manchester-based investor, has successfully raised £220m for its third and biggest-ever fund.

The 18-strong outfit led by Gary Tipper has been one of the region’s most active private equity firms in the last two years, with investments in restaurant brands Gusto and The Alchemist and Stockport-based licensed bedding specialist Character World.

The £220m was raised in just 11 weeks and was significantly oversubscribed. In a process led by Evercore Private Funds as global placement agent, investment was secured from UK, European, N. American and Asian public and private pension plans, insurance companies,  family offices and high net worth individuals.

The final close of Fund III follows the success of the £150m Palatine Private Equity Fund II, which is fully invested having completed 10 investments including the buyout of mortgage broker John Charcol and Towergate Financial Planning, now rebranded as Wren Sterling;  and the secondary buyout of Character World.

Palatine was founded in 2005 and raised its maiden £100m fund in 2007, which has generated market-leading returns, including XLN Telecom (4.5x return), Air Energi (3x return) and Hallmark Hotels (2x return).

Gary Tipper, managing partner of Palatine, said: “We appreciate the continued support from our existing investors and the vote of confidence from our new partners. Almost 100% of existing investors re-committed with nearly all increasing their commitment size.
 
“We are very excited about the potential for Fund III and look forward to continuing our focus on providing a partner-led approach to deals in the UK regional lower mid-market. We could have raised a significantly larger fund given the level of interest from investors, but we resisted that temptation, so we can continue to focus on our existing market space where we believe there is significantly less competition.”

Richard Anthony, chief executive of Evercore’s Private Funds Group, added: “We are thrilled with how this fundraise has played out. The sheer level of investor interest and moreover, their willingness to move quickly to secure an allocation is undoubtedly a testament to the strength and quality of the Palatine team and track record.”