Every now and then, a first-time private equity fund comes along that doesn't meet the criteria that institutions typically insist on – but gets funded anyway. A recent example is AnaCap Financial Partners, the brainchild of Joe Giannamore.
AnaCap closed its first fund in April on €300 million ($372 million), €50 million above target, to invest in European financial services companies. A roster of blue-chip financial institutions backed the group, despite the fact that Giannamore didn't have much to show by way of a conventional private equity track record, nor could he present a fully formed investment team that had been working together for some time. In fact, when potential investors were first shown the AnaCap investment proposition in the third quarter of 2005, Giannamore didn't have a team at all.
A former investment banker with Salomon Brothers and Goldman Sachs, the ace up Giannamore's sleeve was essentially one deal: in 1996, he began building On:line Finance, an internet lending business with a focus on auto credit, which he sold to GMAC in 1999. Giannamore does not disclose any financial details of the sale, but according to sources familiar with the transaction, the project's three institutional backers – Merrill Lynch, Intermediate Capital Group and ICAP – reaped a very significant return from their investment.
Giannamore continued to run On:line until 2001 when he became CEO of GMAC UK. In 2003, he took a year off before starting discussions with several private equity groups about setting up a financial services-focused sub-fund for one of them – discussions that ultimately persuaded him that a financial servicesfocused private equity platform didn't really have a place inside a mainstream private equity firm. Instead, Giannamore decided to raise a fund as an independent operator.
In mid-2005, the Private Fund Group at Credit Suisse completed a four months in-depth due diligence process on the project, and fundraising got underway last August. Now that €300 million of equity capital has been secured, Giannamore intends to move at a measured pace: investors have been told not to expect more than one investment before year-end.
This is despite the fact that AnaCap does have a team of senior investment professionals in place now. While the fundraising was moving towards a successful conclusion, Steve Barry, a former CFO and head of risk at London Mortgage Company, GE Capital veteran (and an erstwhile colleague at On:line) Peter Cartwright and Finlay McFadyen, a former managing director with European private equity house Terra Firma, all decided to come on board.
ECI PARTNERS STRENGTHENS LONDON OFFICE
UK mid-market private equity firm ECI Partners has appointed Tom Wrenn as an investment executive in its London office. Wrenn joined ECI from the private equity unit of Close Brothers Corporate Finance. During his two-and-a-half years at the firm, he focused on the leisure and media sectors, advising both public and private transactions before moving to the private equity team. Prior to that, Wrenn spent four years at Deloitte & Touche, where he began his career as a tax advisor in the mergers and acquisitions team advising on European buyouts and large corporate transactions.
BLACK DIAMOND TO OPEN IN UK
US-based alternative investment firm Black Diamond Capital Management has appointed Peter Cannon as managing director of its new London operation, Black Diamond GB (BDGB), which opens in June. Cannon was most recently senior portfolio manager at RMF Investment Management, part of the Man Group, where he helped develop the company's CDO franchise. Prior to that, he was a senior fund manager for Merrill Lynch Investment Managers and director of acquisition finance at Lloyds TSB, where he established and developed the bank's leveraged finance business in Europe. The firm will make more hires in the “near term future”, according to a statement.
DOUGHTY HANSON BOLSTERS NORDIC OPERATIONS
Swedish national Jan Amethier, 44, will join Doughty Hanson as a senior principal focusing on the Nordic region at the beginning of July in the firm's Stockholm office. Amethier moves to Doughty Hanson from JP Morgan, where he has been head of Nordic investment banking since 2003, having joined in 1994. Between 1992 and 1994, Amethier was a special advisor on privatisations for the Swedish Ministry of Industry & Commerce. Before that, Amethier worked in the London and New York M&A departments of Goldman Sachs and as a strategy consultant at Boston Consulting Group.
3I'S NOLAN TO TAKE RESPONSIBILITY FOR UK BUYOUTS
3i has appointed European buyouts managing director Ian Nolan to oversee its UK buyout operations. Nolan will take over from Nick Badman, managing director in the UK buyouts team, who has been with 3i for the past 17 years and will be leaving the firm later this year. Nolan began his career at 3i in 1987 in Manchester before moving to the London office as a director in the buyouts team in 1995. In 1998, he returned to Manchester as managing director of 3i's business in the North West of England, before returning to London in 2004.
DLJ STRENGTHENS EUROPEAN MEDIA TEAM
DLJ Merchant Banking has appointed Tim Schoonmaker, 48, a 17-year veteran of UK media group Emap, Nigel Walmsley, 64, a former managing director of Capital Radio Group, and Rupert Shaw, who has spent the last five years at GMT Communications Partners, as industry partners to bolster its European media activities. The team will work in London alongside Colin Taylor, managing director and head of DLJ Merchant Banking Europe, to originate media-related private equity investments in the UK and consumer and business-to-business media investments in the whole of Europe.
CVC HIRES LEVERAGED FINANCE SPECIALIST
CVC Capital Partners has continued to bolster its leveraged finance expertise with the appointment of David Wood in its London office. Wood was co-head of European leveraged finance at Deutsche Bank for the past six years. Prior to that, he worked as a senior banker in acquisition finance at JP Morgan. Wood has worked within the leveraged financing and banking market for over 30 years in total, and has been involved in a number of CVC's transactions during that period, including the €1.5 billion ($1.8 billion) acquisition of Ruhrgas last June.
SOVEREIGN CAPITAL PROMOTES TRIO
Three members of the team at ([A-z]+)-based UK mid-market investor Sovereign Capital have moved up to become investment managers. Dominic Dalli joined Sovereign in 2002 after five years with the healthcare team at Deloitte Corporate Finance; Simon Hitchcock also joined in 2002 after three years at Dilmun Investments, the UK private equity subsidiary of Bahrain International Bank; and Jose Rodriguez was recruited in 2004 after five years supervising M&A transactions and international operations in Mexico's Banking and Securities Commission.