Beechbrook Capital completes fifth investment from fourth European fund

12 April 2023 – Beechbrook has completed its fifth investment from its fourth pan-European debt fund, representing c. €60m of deployed capital. The fund focuses on supporting sponsored and non-sponsored businesses across the northern European lower mid-market.

Since its founding in 2008, Beechbrook has remained disciplined and not deviated from this differentiated market niche. During its 15-year history, the firm has developed considerable investment experience across multiple sectors for companies of this scale. This experience, together with a medium to long-term investment horizon, and a flexible debt product, has allowed the specialist private debt manager to continue investing throughout 2022 despite macro-economic headwinds. The funds have, and continue to, support quality businesses in sectors that are underpinned by favourable market dynamics and long-term growth characteristics.

The investments in the latest fund include a German healthcare business, a German manufacturing business related to the food industry, a Dutch ESG performance measurement business, a Dutch specialist recruitment business, and a Danish digital marketing business. All these transactions involved backing quality and experienced management teams, alongside strong private equity sponsors, to support primary and secondary buy-outs and bolt-on acquisitions.

One example is the fund’s investment in Q4 22, in Circle8, a Dutch staffing services provider specialising in IT professionals. Beechbrook’s experience, both in this sector and geography, enabled the team to look beyond general economic headwinds that could impact the staffing sector, and focus on the niche product offering of Circle8 and the specialist dynamics of their respective market. Circle8 is owned by Axiom Partners, a private equity investment group with offices in Zurich and Amsterdam. The group connects ambitious clients with outstanding IT workers and provides a wide range of options for flexible employment in the IT industry. Since the initial acquisition by Axiom Partners of De Staffing Groep in 2021, they have been on a buy and build strategy. A further acquisition of Fixed Today was completed in Apr-22, and the most recent acquisition, supported by Beechbrook, was of Seven Stars in Oct-22.

Guus Franke, CEO and founder of Axiom Partners, said: “The acquisition of Seven Stars strengthens our position within the flexible IT staffing market. Beechbrook did an excellent job of understanding our business and have provided us with a financing solution that will help deliver the next phase of our growth. Beechbrook’s approach was efficient and pragmatic, and we look forward to working with them on the next stage of our journey”.

The fund’s latest investment completed in Mar-23 and marks the first investment for the firm in Denmark. The fund has supported a leading German PE sponsor in their buy-out of a digital marketing agency based in Copenhagen.

As demonstrated by these recent deals, Beechbrook’s funds present borrowers across a diverse range of sectors with a stable source of capital throughout all stages of a business cycle. The firm remains active, and the pipeline of opportunities is healthy across multiple European jurisdictions. The fund will be open to new investors until the end of 2023.