Fourth private equity fund from Old Mutual

3 Jul 2013

Old Mutual Investment Group has launched a fourth private equity fund targeted at high net worth individuals and institutions.

The fund was launched in response to market demand after the company's other three funds closed to investors.

Old Mutual Private Equity manages R3.2bn in direct private equity funds. In the past nine years‚ it has invested over R6bn in 23 transactions and returned over R13bn to investors.

The newly launched Old Mutual Multi-Manager Private Equity Fund 3 invests in five underlying private equity managers.

These include Actis‚ Ethos‚ Capitalworks and two of Old Mutual's direct funds. Investors are exposed to over 40 companies in a range of industries.

Private equity funds invest capital in unlisted companies.

Erika van der Merwe‚ chief executive of the SA Venture Capital and Private Equity Association (Savca)‚ said appetite for this class of assets is "healthy" and equity fund managers are able to find opportunities for growth and returns through carefully selecting the deals and managing the assets.

"Simply put‚ businesses are bought‚ held for a reasonably long time (typically five to seven years) and then sold‚" said Van der Merwe.

"The objective during this period is almost exclusively to enhance the value of the business‚" she said.

As shareholders‚ the private equity funds sit on the management boards and are involved in running the businesses.

Investors can access the Old Mutual Multi-Manager Private Equity Fund 3 with investments starting at R100‚000.

Source: I-Net Bridge

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