Investment & Fund Management

ARX Equity Partners, a private equity firm focused on lower mid-cap investments in Central Europe, faced the challenge of raising capital for its fourth fund, ARX CEE IV, with a target of EUR 100 million. The firm aimed to capitalize on succession-driven deal flow in the region, particularly in the Czech Republic, where it has established a strong market presence. The Czech economy was experiencing robust growth, with a GDP increase of 4.3% in 2015, driven by a competitive export-oriented manufacturing sector.

To address this capital-raising challenge, ARX secured an investment from the European Investment Fund (EIF) as part of the COSME programme, which supports access to finance for small and medium-sized enterprises (SMEs). The first close of the fund was successfully completed at EUR 54 million, with total commitments reaching EUR 66 million. This funding will enable ARX to continue its strategy of investing in lower mid-cap businesses and SMEs, enhancing its ability to execute management buy-outs and industry consolidation transactions.

The investment from EIF not only provided essential capital but also positioned ARX to leverage its expertise in the Czech market and expand into other Central European countries with favorable investment climates, such as Slovenia. The firm has a proven track record, having completed 22 platform investments and numerous add-on acquisitions over its two-decade history. The anticipated benefits of this funding include increased investment activity in the region, contributing to economic growth and job creation in the targeted markets.