European Capital seals first deal from SME fund

European Capital UK SME Debt fund, together with European Capital and its subsidiaries, has arranged a unitranche financing supporting the acquisition of sofa.com by private equity firm CBPE Capital, according to a statement.

Terms of the deal were undisclosed. European Capital declined to comment beyond the statement.

“We are extremely pleased to provide financing for the acquisition of sofa.com, which will support its plans for future development in the UK,” said Jerry Tebbutt, managing director at European Capital, said. “This is the first investment from our European Capital UK SME Debt fund, which provides tailored financing for high quality small and medium sized enterprises in the UK.”

Established in 2006, sofa.com is a multi-channel retailer of bespoke high quality sofas, armchairs and beds, with UK showrooms in Chelsea and Bath.

“We are delighted to be CBPE's financing partner in the primary buyout of sofa.com, a successful retailer with a strong brand, differentiated consumer offering and operating model,” said Colin Wright, director at European Capital.

Jolyon Latimer, investment director at CBPE, commented: “European Capital has provided flexible financing to suit the growth plans and operational improvements in our business plan and we look forward to working with them during our investment timeframe.”

European Capital, a wholly-owned subsidiary of American Capital, has €900 million in assets under management and has invested €3.7 billion in 100 companies in Europe since August 2005.

In September last year, the British Business Bank committed £50 million to the £100 million European Capital UK SME Debt fund. It is managed by European Capital Debt Management, which has offices in London and Paris. The firm and its affiliates will consider senior, mezzanine and unitranche debt investment opportunities from 10 million to 100 million in either euros or sterling and up to 300 million for one-stop buyouts.