2012Two Italian PE Funds Take Off
by Jonathan Braude
Published in The Daily Deal
June 18, 2004
Two private equity firms focused on Italy advanced new investment plans, but both acknowledged the challenges of raising funds to invest there in the wake of Parmalat Finanziaria SpA's spectacular bankruptcy last year.
Italian private equity firm Opera, founded by jeweler and luxury goods group Bulgari SpA, said Thursday, June 17, it has signed an exclusive agreement with Bear, Stearns & Co.'s private equity arm to invest jointly in Italian companies.
Under the agreement, Bear Stearns Merchant Banking will designate up to €200 million ($240 million) for investments alongside Opera in companies with revenues in excess of €100 million. The target companies will operate in sectors "related to Italian lifestyle," the firms said.
Like the companies in which it plans to invest, Opera has been finding it difficult to raise new money on its own in the wake of Parmalat's multibillion-euro accounting scandal and collapse. Despite Bulgari's participation, Opera has struggled to raise the €250 million it was targeting for its second fund and recently announced a first closing at €90 million.
The announcement comes just two days after Italian bank UniCredit Banca d'Impresa, the corporate banking arm of UniCredito Italiano SpA, said it is creating a €100 million private equity fund, almost entirely underwritten by the bank, but independently managed by a unit of Benetton family investment fund Gruppo 21 Investimenti.
In an apparent reference Parmalat's effect on Italian investors, the UniCredit statement goes to great lengths to stress that 21 Investimenti's management was intended "to avoid the potential conflicts of interest which might arise from investing risk capital in companies to which the bank has also lent money."
Despite the difficult environment, Bear Stearns and Opera are upbeat about the prospects for the Italian market. Opera managing partner Renato Preti said the alliance with Bear Stearns will help Italian companies network and grow in the U.S., "which has historically been the primary export market for Italian lifestyle products."
Carlo Bronzini Vender and Cyrus Deboo of New York investment bank Sonenshine Pastor and Stephen Haimo and Edward Sopher of Gibson, Dunn & Crutcher LLP advised Opera. Michael Edsall of Kirkland & Ellis LLP advised Bear Stearns.