ARX CEE IV holds first close towards €100 million target, supported by the EU COSME programme
ARX Equity Partners has completed a first close of its latest Central Europe vehicle at € 54 million, with total subscribed commitments of €66 million.
ARX Equity Partners (“ARX”), a leading lower mid-cap focused private equity firm operating in Central Europe, is pleased to announce the first closing of its fourth fund, ARX CEE IV (the „Fund“), at €54 million, with total subscribed commitments of €66 million.
The Fund, which has a target of €100 million including commitments from the European Investment Fund (EIF), will continue to execute the ARX value-creation strategy of investing in lower mid-cap businesses and SMEs in select Central European countries. ARX has completed 22 platform investments and numerous add-on acquisitions over its two-decade operating history in the region. The EIF investment benefits from EU support under the COSME programme funded by the European Commission.
ARX anticipates that the majority of the Fund will be invested in the Czech Republic, where the firm has established itself as a market leader in succession-driven transactions. The Czech economy expanded by an impressive 4.3% in 2015, propelled by strong exports, which grew by 7.2% over 2014. Czech GDP growth levels are expected to remain strong in 2016 and 2017, primarily driven by the country’s highly competitive export-oriented precision manufacturing industry.
The Fund will complement its strong Czech presence with investments in certain additional Central European countries with attractive investment environments, such as Slovenia, where ARX recently generated a 4.1x cash-on-cash return from its Tomplast investment.
Brian Wardrop, ARX Managing Partner, commented: „We look forward to capitalising on several uniquely distinctive features that are generating succession-driven deal flow momentum in our target market. We are also especially pleased that several well-respected local investors have chosen to endorse the ARX strategy and its differentiated geographic positioning and would like to thank all our investors for their support.“
First close investors in the Fund include institutions such as the European Investment Fund, leading Czech retail bank Ceska Sporitelna and RSJ Private Equity, in addition to several family offices.
The ARX IV Fund benefits from the support of the European Union under the Equity Facility for Growth (EFG) established under Regulation (EU) No. 1287/2013 of the European Parliament and the Council establishing a Programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) (2014-2020).
About ARX (www.arxequity.com)
ARX is a lower mid-market focused private equity firm targeting investments in select countries of Central Europe. The ARX family of funds focuses on later stage investments, such as management buy-outs and buy-ins and industry consolidation transactions. The firm is headquartered in Prague.
About the COSME Equity Facility for Growth (EFG)
The Equity Facility for Growth (EFG) is dedicated to investments in risk-capital funds that provide venture capital and mezzanine finance to expansion and growth-stage SMEs, in particular those operating across borders. It is expected that some 500 firms will receive equity financing through the programme, with overall investment reaching up to €4 billion. The EFG is part of COSME, the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020. It has a total budget of €2.3 billion and at least 60% of the programme will be devoted to improving access to finance for SMEs in Europe. Businesses can contact selected financial institutions in their country to access EU financing: www.access2finance.eu.
About the European Investment Fund
The European Investment Fund’s (EIF) is part of the European Investment Bank group. Its central mission is to support Europe’s micro, small and medium-sized businesses by helping them to access finance. EIF designs and develops both venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.