Private-equity player Synova may earmark part of €1bn fund for Ireland

Private-equity player Synova could earmark part of the €1 billion it recently raised from backers to invest in Ireland, the company confirmed at the weekend.

London-based Synova has just raised £875 million sterling (€1 billion) from mainly institutional backers, about €300 million of which it is reserving for its Chrysalis pool, which it will use to back smaller companies.

Dubliner David Menton, co-founder and managing partner, said Synova was actively looking to invest some of this in Ireland, following up three already successful investments here, the first of which it made in 2015.

“It gives us greater scope for similar and larger opportunities in the Irish market,” he said.

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Mr Menton explained that the industries on which Synova focused, technology, health and life sciences and financial services, were well represented here.

The company previously invested in Doran + Minehane (D+M), a Limerick-based business specialising in providing accounting to the alternative asset-management industry.

The other ventures that the private-equity business has backed are 3173 in Belfast, which develops software for pensions administration and trusteeship, and technology business Meritsoft, which was subsequently sold to Nasdaq-listed Cognizant.

Synova generally targets founder-led companies with the potential for high growth, according to Mr Menton.

Overall, the business is looking at investing in companies valued £20 million and £250 million with the cash it has just raised from backers.

Along with Ireland and Britain, Synova will also seek opportunities in continental Europe.

According to a statement, the latest fundraising round brought it assets under management to £1.7 billion.

The company originally targeted £750 million but closed the fundraising round, its fifth, at £875 million following what it called “overwhelming” support from investors.

Synova’s backers are mainly institutional investors, but Mr Menton noted that some family offices also supported the business.

Existing investors increased their commitments to Synova by more than 50 per cent on average, while it also attracted some new backers.

In their statement after the company closed the round, Mr Menton and co-founder Phillip Shapiro said the speed at which they raised the fund reflected the company’s strength and the strong partnerships it has built with investors.

“We are committed to continuing to deliver outstanding returns through partnering with remarkable companies and great founders and supporting them to deliver exceptional growth across our core sectors,” they added.

The pair founded Synova 15 years ago. Its previous funds achieved average realised returns of 6.2 times invested capital, the company said.