UPDATE 1-Private equity firm IK raises $1.9 bln, misses target

Wed Oct 23, 2013 10:58am EDT

By Arno Schuetze

FRANKFURT Oct 23 (Reuters) - Private equity group IK Investment Partners has raised 1.4 billion euros ($1.9 billion) from investors for its latest fund, behind schedule and around 300 million euros short of its initial target.

IK, which started fundraising in December 2011, collected 1 billion euros by the time of a so-called first close in March 2012 - the point at which it can start investing, a person familiar with the firm said on Wednesday, adding the euro zone crisis ended its hopes of reaching 1.7 billion soon thereafter.

While some firms like IK, Apax, Permira and Warburg Pincus have been struggling to meet their targets, others like Advent and CVC have had to turn away money.

Results in fundraisings often reflect the success or failure of prior funds, and the development of IK's portfolio companies has been mixed over the last couple of years.

IK last month sold German sanitary fittings maker Hansa to Finland-based Oras in a deal that generated a return of 2.7 times its original investment, the source familiar with the private equity group said.

But in April, IK's Flabeg filed for insolvency, even though the private equity group had twice supplied fresh money to stabilize the maker of solar parabolic mirrors and automotive mirrors. Saudi Arabia's ACWA later bought Flabeg's solar unit from the administrator.

Last year, IK appointed banks to advise it on a sale or listing of Attendo, one of the Nordic region's largest healthcare providers. But no deal materialised.

Also in 2012, the sale of measuring and materials handling equipment maker Schenck Process failed after IK deemed offers too low.

IK, which manages more than 7 billion euros and has invested in over 80 European companies, attracted 16 new investors, the group said on Wednesday.

The new IK VII Fund has already made three investments, buying inspection group Veritas Petroleum Services, offshore energy servicer Ampelmann and survival suits maker Hansen, IK said.

"We expect to make three to five further investments with an equity value of at least 60-90 million euros each within the next twelve months," managing partner Detlef Dinsel told Reuters, adding IK was also targeting the sale of two to three companies and recapitalising another two to three firms.

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