YFM Equity Partners (YFM) has announced the final close of its Buyout Fund II, ahead of target, with £80 million of committed funds and a wave of new high net worth and entrepreneurial investors.
The partner-led private equity firm with offices in Leeds, Manchester, Birmingham and London, now has over £300m of funds under management across a portfolio of 40 companies and typically invests around £5m per transaction. Deals funded from the Leeds office include the investment in fast-growing passive fire protection company Checkmate Fire and Brighouse-based TEV Ltd which manufactures cooling, heating and refrigeration equipment.
“The majority of Buyout Fund I investors have come into the new fund which is a strong sign of support from our investor base. We’re also pleased to have attracted nearly 40 new investors, each typically committing sums of between £500,000 and £5m, which is a great endorsement of our market, approach and performance,” said Mike White, YFM’s partner responsible for fundraising and investor relations.
YFM’s strategy is to raise funds that are invested over three to four years, principally from high net worth, entrepreneurial investors. “This is a different approach to most private equity funds, but it’s delivered flexibility of timing between funds, increased the diversity of investors and works really well for funds of this size,” added White.
Buyout Fund II will continue the strategy of the first fund, typically investing between £3m and £10m per transaction into businesses with strong growth potential located across the UK regions through YFM’s network of offices in London, Leeds, Manchester and Birmingham. The fund is targeting to invest over a three to four year period, extending into 2023.
White continued: “It’s been encouraging that the momentum we have built up has continued to accelerate, resulting in a final close ahead of target. Most of our investors are owner managers who have realised value either partially, or in full, from businesses in the markets and sectors in which we invest. It’s been a real pleasure to meet these successful entrepreneurs who clearly show a strong empathy and understanding of what we do, how we do it, and are comfortable with the types of businesses we invest in.”
David Hall, YFM managing partner, added: “We believe the market for these smaller businesses is less well-served, which was demonstrated by the success of Buyout Fund I, which built its portfolio within three years of final close.
“Clearly, we are in a period of uncertainty at the moment, but as in previous times of uncertainty, we are confident that now is a great time to have a new fund ready to deploy, and that there will be some exciting opportunities for investment.
“We’ve been encouraged by the strong investor appetite and our team is excited by the prospect of having these additional funds to invest in the UK’s smaller businesses. And, having very recently completed one new investment and one successful realisation, we are and remain open for business.”