So, everyone has been wondering for some time what the hell was going to happen to 3i’s portfolio when it announced it was pulling out of private equity last year.
There’d been whisperings that 3i and top-tier European VC firm DFJ Esprit had cooked up a deal. But now it’s been announced that Coller Capital and HarbourVest Partners, together with DFJ Esprit will acquire a significant part of 3i’s European venture portfolio for around £130 million ($217 million). At the same time DFJ Esprit has announced the launch of two funds totaling $500 million.
The acquired portfolio has a swathe of Europe high growth companies operating in technology, media, telecoms and healthcare, such as: Icera Semiconductors, a wireless soft modem company; Light Blue Optics, a developer of miniature laser projector systems; ApaTech (orthobiologics); The Cloud, a big European wireless broadband network; CamSemi (energy-efficient power tech); and FastBooking, the direct bookings on hotel websites service.
The portfolio will be managed by DFJ Esprit through a new division called Encore Ventures. Encore I, Encore Ventures’ first fund, will be a $280m (£170m) fund and will have Coller Capital and HarbourVest Partners as its sole investors. The deal also means “significant follow-on capital” will head in the direction of the companies.
DFJE’s Simon Cook says this means the establishment of a dedicated portfolio secondary team working alongside its primary fund team. No word yet on what this means for 3i investments like Twenga and Taptu, but we’ll check in with them to find out.