Danske PE spin-out SAGA closes debut fund below target

Fund of funds manager SAGA Private Equity will back approximately 16 small and mid-cap buyout funds in Europe and North America.  

Fund of funds manager SAGA Private Equity has wrapped up fundraising for its debut private equity vehicle, below its €700 million target.

Copenhagen-based SAGA gathered €600 million for SAGA VII, closing the fund on 30 April, Jesper Knutsson, a partner at SAGA, told Private Equity International.

The firm, which spun out from the private equity unit of Danske Bank in 2017, began fundraising in early 2018 and held a €170 million first close in March that year, Knutsson said. The firm held six closings throughout the fundraise.

The majority of the limited partners in the fund are insurance companies and pension funds in Europe, Knutsson said. Foundations and family offices in Europe and North America also contributed capital to the vehicle.

Similar to the team’s strategy at Danske Private Equity, SAGA will invest roughly €40 million in about 12 to 16 small and mid-cap buyout funds in Europe and North America. Fund VII also has scope for co-investments and secondaries transactions which it will only do so on an opportunistic basis, Knutsson said.

Fund VII will favour sector-focused funds as well as buy-and-build and turnaround funds.

Capital raised from the fund has so far backed five buyout funds and one co-investment, according to a statement. Details of the investments were not disclosed and Knutsson declined to comment.

Danske Private Equity’s six previous funds – the latest of which is the €700 million, 2015-vintage Danske Private Equity Partners VI – are under SAGA’s management, Knutsson said. All have been fully deployed.

John Danielsen, the founder of Danske Private Equity, left the Danish fund of funds along with senior partner Peter Thellufsen in 2017, as previously reported by PEI. Following their departures, the bank planned to integrate the PE unit with Danske Bank Asset Management, according to a statement at the time. PensionDanmark and PKA AIP Private Funds were investors in Danske PE’s funds, according to PEI data.