Erste Asset Management has raised €80m so far for a private equity fund of funds focusing on investments in Central and Eastern Europe.
Erste Diversified Private Equity I aims to raise up to €150m from both institutional investors and qualified retail investors, starting from the fourth quarter of 2022.
‘Private equity has become an established asset class. It is now a significant element of the strategic asset allocation of long-term investors.
‘We noticed that and have created in cooperation with our partners in Luxembourg an attractive product which we will gradually expand with the help of a strong, experienced team,’ said Thomas Bobek (pictured), head of private equity management at Erste.
The fund will invest in venture capital and private equity funds, which have underlying investments in scalable business models with little dependence on short-term economic cycles.
Erste Group will act as anchor investor for the fund, with initial investments coming from pension funds and insurance companies from Austria and abroad.
The fund has already made two investments, deploying capital into Austrian venture capital funds Speedinvest and 3TS Partners.
Speedinvest is a pan-European fund with €400m in assets investing in early-stage technology startups. 3TS provides expansion capital and buyout finance to small and medium sized businesses in growth sectors such as media and communications.
‘Our clients’ interest in private equity investments has increased significantly in recent years, supported by a low interest rate environment and the demand for investment alternatives to traditional equity or bond funds.
‘With the private equity fund of funds, we provide companies with more capital and our clients with a newly established asset class in the CEE growth market,’ said Heinz Bednar, CEO of Erste Group.
The launch of the fund comes after Erste Group brought together its private equity activities under one roof, creating Erste Private Capital in October 2021. Bobek is a member of the board of the new subsidiary, which is led by managing director Ralf Kunzmann.