Private Equity: Advent raises record $30 billion for new fund

The private equity investor Advent has received capital commitments of $30 billion from investors for its eleventh investment fund “GPE XI”. This emerges from a statement from the financial investor headquartered in Boston, which was available to Handelsblatt in advance.

According to Ranjan Sen, Managing Partner at Advent, the private equity house is heading towards a record volume of investor money: “With $30 billion in capital commitments, the new fund platform is one of the largest we have seen on the private equity market to date.”

His colleague, Ronald Ayles, also Managing Partner at Advent, emphasizes: “We see the strong support of our long-standing investors and the trust of many new investors in GPE XI and our mid-market strategy as confirmation of our long-term investment approach and our track record.”

A significant portion of the fresh capital is likely to flow into investments in Europe and Germany. Advent partner Sen confirms: “Historically, Advent’s investments were relatively evenly distributed between the USA and Europe, with a small share in the Asia-Pacific region.”

Advent has managed two billion-dollar sales of portfolio companies this year and has therefore provided its investors with high cash returns: At the end of April, Advent, together with Cinven, sold Thyssenkrupp's former elevator division, TKE, to Kone. The Finnish elevator maker paid 29.4 billion euros after Advent and Cinven acquired the business for 17.2 billion euros in 2020.

In June, the Advent holding Innio had a successful IPO in the USA, with a valuation of around $25 billion. A profitable business for Advent and its investors: The financial investor took over the Austrian gas engine manufacturer from General Electric in November 2018 for $3.25 billion at the time.

With the new fund platform, Advent has the financial clout for new billion-dollar deals. According to Advent, almost $27 billion of the fresh capital will flow into the flagship fund. This is targeting equity investments of between $350 million and $2 billion, explains Advent partner Sen in an interview with Handelsblatt.

"Pleasingly, the new fund has also grown compared to the previous fund. The size of the fund also allows us to present large future transactions." In addition to the takeover of corporate spin-offs, the takeover of listed companies, so-called public-to-private transactions and joint investments together with family businesses are also an essential part of their investment strategy.

The remaining more than three billion dollars are available for transactions in the small and medium market segments. According to Sen, the company is planning to use equity capital to buy tickets worth between $100 and $350 million.

“In the past, we at Advent have covered a wide range of transactions, such as the acquisition of TKE, but also the recent investment in Munich-based FNZ Bank,” adds Sen. “With the new fund, we have received a mandate from our investors (LPs) to continue this successful strategy.”