NORD Holding issues a € 250 mil. Fund - Fund of Funds becomes a second pillar
The company issued a fund of funds for the first time in 2000 with an initial volume of € 93 mil. as a complement to its core business. This fund in turn invested in 12 domestic and overseas private equity enterprises. As of 31.12.2005 performance was significantly above the original target return of 15%, which was also predominantly tax free for the investors. The structure of the fund of funds ensures a broadly balanced portfolio as the investments are efficiently spread over a large number of medium sized enterprises. This therefore enables, for example, smaller savings banks or insurance companies to benefit from the return opportunities offered by private equity without having to commit to "lump" risks.
Based upon the success of the first fund of funds a second company has been incorporated. Already after the initial closing the volume more than doubled to € 188 mil. primarily through established investors. In addition to NORD/LB, investors are mainly savings banks and the pension funds of occupational professionals. Additional investors have been invited to participate in the second closing scheduled for the 4th quarter 2006. The fund, however, is not intended to exceed € 250 mil. "We are not aiming for size, instead we wish to offer our shareholders an ongoing attractive return", stated NORD Holding managing director, Matthias Kues, defining the company's strategy.
Kues ascribes the success of the first fund of funds to the fact that NORD Holding has been instrumental itself in pursuing the private equity business for 40 years and therefore has a wealth of experience at its disposal in selecting management teams in which the fund of funds invests. In his estimation, no other provider in the fund of funds industry can offer this combination.
With just under 40 year's experience NORD Holding is one of the leading private equity companies in Germany. Its activities focus on the structure and funding of succession issues as well as expansion stage financing for medium sized companies. In recent years spin-offs of medium sized business units from large corporations have played a greater role in NORD Holding's portfolio of activities.
The new fund of funds pushes NORD Holding's managed funds volume for the first time above the € 600 mil. level.
About NORD Holding
With its 50-year history and over € 2.0 billion assets under management, NORD Holding is one of the leading private equity asset managers in Germany with a focus on direct and fund investments.
The fund investments division targets the small- and mid-cap segment of the European private equity market through primaries, secondaries and co-investments.
NORD Holding has a strong focus on emerging buyout managers, hands-on investment strategies and regularly acts as an anchor investor. The division manages € 1.3 billion and ranks among the top decile fund investment groups in Europe.
The direct investments division of NORD Holding focuses on structuring and financing company succession models, acquiring parts of larger groups/subsidiaries as well as on expansion financing of medium-sized companies. In contrast to most other financial investors, who only manage closed-end funds, NORD Holding acts as a so-called "evergreen fund", thereby investing from its own balance sheet with no maturity restrictions. Currently, the fund has interests in more than 15 companies in the DACH region.