Beechbrook closes two new deals in the UK and Sweden

Beechbrook Mezzanine II is 50 percent invested as a result.

London-based lender Beechbrook Capital has completed two new investments from Beechbrook Mezzanine II fund, the firm said in a statement.

The deals mark the eighth and ninth investments made by the fund, which closed in July this year on €151 million.

The first new deal is a mezzanine loan and preferred equity investment to support the management buyout of UK pharmaceutical company, IPS Specials, by the company’s founder Ashok Patel. The company manufactures and supplies UK pharmacies with ‘specials’ – unlicensed medicines created for patients for whom there are no suitable licensed products available. The business was bought from private equity firm Elysian Capital.

The second transaction is a mezzanine payment-in-kind and equity co-investment to support the buyout of Leo’s Lekland, an operator of children’s indoor play centres in Scandinavia, by Swedish private equity firm Litorina. Headquartered in Lulea, Sweden, Leo’s Lekland has ambitious expansion plans, Beechbrook said. It is the second investment Beechbrook has made in Sweden and the fifth in the Nordic region.

Partner at Beechbrook, Paul Shea said: “We are continuing to see attractive opportunities in the lower mid-market. The pipeline remains strong and we are on track with our deployment. Our second fund is now 50 percent drawn and we expect to be raising Fund III in the second half of 2015.”

Beechbrook has about €200 million of assets under management. The manager invests in small to medium sized businesses in Europe with a typical enterprise value of between €10 million to €100 million, investing an average €4 million to €10 million per transaction. Beechbrook has completed 25 direct loans to Northern European businesses since the firm started lending activity in 2010.