Private equity firms are keen to take advantage of a good fundraising market by raising new vehicles.
Triton, which is led by managing partner Peder Prahl, has begun talks with existing investors about launching a lower mid-market fund that it will invest alongside the €3.5 billion buyout fund that it raised in 2013, according to people familiar with the matter.
Triton is expected to raise between €300 million and €500 million for the fund, according to one person. The vehicle will invest in European companies with enterprise values between €25 million and €100 million. It will typically write equity tickets of between €20 million and €40 million, according to one of the people.
Triton is setting up a new team, which will have a separate investment committee, led by Triton executive Andi Klein, who will be joined by colleague Per Frankling. The firm will make additional hires to bolster the team.
Triton launched the strategy on the back of strong investor demand for exposure to the lower mid-market, one person said.
Triton is the latest firm to launch a lower mid-market strategy in the past two years. London-based Inflexion raised a combined £500 million for investments in the lower mid-market in May 2016 after finding itself locked out of the lower end of the market, Private Equity News reported at the time.
IK Investment Partners closed its debut small-cap fund on €277 million in March to capture investment opportunities that fell outside the remit of its main private equity fund.
London-based Livingbridge also amassed £220 million for its small-cap fund in September 2015 to tap into deal flow in the lower end of the market. It had previously raised £360 million for its fifth fund, an increase on the £237 million it raised for its fourth fund in 2007.