Swiss private bank bounces back with new private equity fund
Swiss private bank Lombard Odier Darier Hentsch has shaken off the difficulties at two of its hedge funds this week by today closing a Sfr776m (€512m) private equity fund.
The bank’s private equity arm LODH Private Equity has raised its fourth private equity fund of funds, which is also set to be followed by two hedge funds of funds to be launched shortly, the group said.
The private equity fundraising success follows the confirmation on Tuesday of the liquidation of Lombard Odier's Delta Global and Alternative Strategies funds of hedge funds, a spokeswoman said. The funds have a combined net asset value of Sfr1.1bn.
A spokeswoman for the main Lombard Odier group said the two events were unrelated.
The group’s private equity arm is thriving in an environment where fund closings have been limited and a spokeswoman for the division said it had met its target of raising more than LODH Private Equity’s €493m ($699m) third fund. The firm completed the latest fundraising in a year and Lombard Odier invests in all the firm’s funds, the spokeswoman said.
The firm is solely focused on investing in European mid-market funds and its fundraising continues a spell of continuous but measured growth at the arm. It raised €167m for its first fund and €214m for its second fund.
Despite the changed market environment, the group is generally pursuing a similar investment strategy to the past, according to the spokeswoman for the buyout arm, although she added: “We focus on turnarounds, maybe more than we did a few years ago.” The firm will also consider opportunities in the market for second hand fund assets.
She also said: “[The fund will also invest in] countries which are slightly less developed in private equity terms, countries like Italy or Spain, where we think there’s more room for private equity.”
The bank’s co-founder Thierry Lombard said in a guest comment for Financial News’ sister publication Wealth Bulletin on Wednesday that his bank “remains cautious” because there had yet to be a significant restructuring of debt in the global economy.
He implicitly defended his bank’s use of hedge funds and private equity in investment, which are generally perceived to be higher risk, unlike some wealth managers. He said he believed there was an “artificial divide” between alternative investments and traditional investment. "There is, finally, only wealth management, good or bad," he said.
--write to tlewis@efinancialnews.com
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