Apax Partners Wraps Up Fund VIII

Apax Partners has closed its flagship buyout fund with $7.5 billion in commitments after a two-year fundraising process, during which the European firm was forced to cut its target by nearly a third.

Similar to many other firms of its size and scale, the London-based firm faced a pool of limited partners that were souring on mega-buyouts and gun-shy about the macroeconomic environment in Europe.

Based on current exchange rates, the roughly 5.8 billion euro final tally makes Apax Europe VIII LP around half the size of its predecessor, one of the largest European buyout funds ever raised. That fund closed in 2007 with EUR11.2 billion.

The firm launched Apax Europe VIII LP in the summer of 2011 with a target of EUR9 billion. Although it was able to close on more than EUR4 billion by March 2012, a lack of demand forced the firm to scale back its ambitions to EUR6 billion, sister publication Private Equity News reported earlier this month. Complicating matters was a mixed track record that included hits like Tommy Hilfiger Corp., which netted a 4.5 times return, and a loss of EUR450 million after drug courier Marken Ltd. ended up in the hands of creditors.

In a reflection of the scaled down fund, the firm moved to cut staff, and initiated plans to shutter offices in Italy and Spain, while instigating an effort to open up a Sao Paolo office.

Perhaps a sign of reassurance in the euro, Apax said in a press release that 51% of the commitments to Fund VIII were made in euros while 49% were made in dollars. It also said that more than 40% of the fund came from North American investors, while European investors provided just 25% of the fund.

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