ECI Partners raises half a billion pounds for new fund

A technology buy-out fund worth £500 million has been raised by London-based investment firm ECI Partners, after the fundraising was ‘significantly oversubscribed’.

ECI Partners has closed its ECI 10 fund five months after launching the fundraising and now has now raised in excess of £1.6 billion since founding.

The firm will now seek to close growth buy-outs with an enterprise value of between £10 million and £150 million and is now the first private equity firm backing UK-based companies to raise a tenth buy-out fund aimed at the same strategy.

Deals for ECI Partners in 2014 have included two new investments and two exits. It began the year by selling M2 Digital Group in February, and has since gone on to back Avantia through a £57 million management buy-out, sell CarTrawler to BC and Insight Partners and invest in ATG Media.

More on ECI Partners deals:

Sean Whelan, managing partner at ECI, comments, ’80 per cent of the capital raised for ECI 10 has come from existing investors, some of whom have now been investors with ECI for over 20 years.

‘ECI is a proven investor in UK mid-market growth companies over many decades. Our success and this latest fundraising are a reflection of the quality and ambition of the management teams we have partnered with over the years.’

On top of the 80 per cent re-up rate from existing investors, ECI reports an average increase on prior commitments of 33 per cent. Five new investors have been brought in through ECI 10, with the list of LPs now covering the UK, US, Europe, the Middle East and Australia.

A target fund size of £400 million had been targeted when ECI launched its fundraising efforts in April. However, a mix of pension funds, fund of funds, insurance companies, endowments, family offices and sovereign wealth capital pushed the total to the half billion pounds mark.

ECI’s last fund, worth £437 million, started investing in 2010. ECI 9 experienced a reported annual growth rate (CAGR) to 30 June 2014 of 21 per cent for EBITDA, 18 per cent for turnover and 19 per cent for employment.

Hunter Ruthven

Bernard Williamson

Hunter was the Editor for GrowthBusiness.co.uk from 2012 to 2014, before moving on to Caspian Media Ltd to be Editor of Real Business.

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Venture capital funding