Orbit advises EIF on its commitment to WAD Capital's search fund.

The European Investment Fund (EIF) has committed a EUR 25m anchor ticket to WAD Capital's debut fund through the InvestEU programme, supporting a strategy centred on Entrepreneurship Through Acquisition and addressing one of Europe's most pressing challenges: the succession of SMEs. As many business owners approach retirement, enabling the next generation of entrepreneurs to acquire and grow established companies is becoming increasingly important for preserving jobs and long-term competitiveness. The EIF is the largest investor in this funding round.

WAD Capital focuses on companies in the Benelux, northern France and western Germany, with an EBITDA typically ranging between EUR 1m and EUR 5m, operating in the healthcare, energy and climate transition, or business services sectors.

“By increasing the number of ‘CEOs in Residence’ from thirteen to twenty-five, we can acquire twenty-five healthy SMEs with a succession challenge and keep them in European hands. This is a way to protect jobs and give strong managers the opportunity to become owners”, says Alain Brossé, Managing Partner at WAD Capital. “We are not setting up yet another private equity fund for SMEs, we are scaling up the search-fund model – a model that has delivered an average IRR of 35 per cent over the past thirty years.”

“Europe is home to many successful SMEs with strong growth potential, which need both capital and entrepreneurial talent to pursue their growth path and reach the next stage. WAD Capital’s innovative approach helps a new generation of entrepreneurs take over established businesses and grow them further. This way, WAD Capital helps tackle succession issues, whilst supporting business continuity, job creation, long-term competitiveness and adapting their strategies to current market needs”, says Robert de Groot, Vice President of the European Investment Bank (EIB).

Orbit supported the EIF on all aspects of the transaction which represents EIF’s first investment in a search fund.

Team

Dr. Joachim Mogck (Partner, LP Advisory), Anne Frommann (Fund Counsel, LP Advisory), and Francesc Lloveras Calvo (Senior Fund Associate, LP Advisory).

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About EIF

EIF is part of the EIB Group. The shareholders are the European Investment Bank (EIB), the European Union, represented by the European Commission, and a wide range of public and private banks and financial institutions.

The EIF’s guarantee, equity and capacity building investments products will continue to deliver financial support across multiple thematic areas: innovation, digitalisation, climate, impact, culture, skills, and more. Visit the website for more information: eif.org/index

About Orbit

Orbit offers client-centered legal advice in all areas of fund law and investments in alternative assets. Fund managers and investors rely on Orbit and its team of experienced fund advisors. Orbit covers structuring, regulatory, tax, investment advice, compliance, and fund due diligence as well as secondary transactions.

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