Click here for printer friendly page

UK-based Alcuin Capital to launch debut fund

UK-based Alcuin Capital is to launch its first independent private equity fund in June. The fund is targeting between £30m and £35m and will focus on investments in small to mid-market UK-based companies in a wide range of sectors.

Alcuin was founded by former Banc Boston Capital professionals Ian Henderson-Londoño and Mark Storey. Henderson-Londoño and Storey were responsible for Banc Boston's small to mid-sized buy-out activities and will continue to invest between £1m and £4m in companies valued at under £15m on an independent basis.

‘We do not focus on any specific sectors because it is hard to anticipate what, at any time, we will find most interesting,' said Henderson-Londoño. ‘In the past we have invested in sectors as diverse as lingerie, coffee bars, and rodent poison manufacturers. The only thing we won't invest in is property.'

The firm is in the early stages of marketing the fund and has not yet secured a cornerstone investor. But Henderson-Londoño said Alcuin was determined to develop a broad range of investors rather than a dominant cornerstone.

‘We are trying to build a widespread but small investor base,' he commented. ‘We are looking for long-term investors in this lower end of the market.'

Alcuin's objective is to launch a series of small mid-market funds over the next few years. ‘We have found that we can generate the best returns from smaller funds rather than a single large one,' said Henderson-Londoño.

‘The bottom end is increasingly uncompetitive and fragmented, especially since players like 3i have pulled out. As the industry has evolved the best firms have mainly gone rapidly upscale and got much, much bigger, leaving plenty of room and deal flow potential in the lower reaches.'

Despite the fundraising drought that has hit several high profile mega-funds, Henderson-Londoño remains positive about Alcuin's prospects.

‘No-one is expecting the market to be great,' he explained. ‘Things are obviously not going to be as easy as they were in 1997 and 1998. But we feel positive based on the conversations we have had so far.

‘We are not looking for people to part with £50m or £60m, where capacity and liquidity are clearly major issues. We are looking for investors interested in the pitch that now is a good time to invest £3m or £4m at the smaller end of the market.'

Copyright © 2003 AltAssets