Yarra seeks $100m for private capital fund

Yarra Capital Management is looking to raise $100 million for its Yarra Private Capital Discovery fund which will invest in companies prior to their IPO.

The fund would invest in a diversified portfolio of holdings that have an intention to go public or conduct a trade sales process within three years. It would seek to provide returns of 6% per annum.

Yarra was seeking to raise $100 million and had capped it at $200 million, the fundraising would close on 1 December.

Speaking to Money Management, portfolio manager, David Acton, who joined the fund from Goldman Sachs last month, said this was the right time to launch from a structural and a tactical perspective.

“This is a great opportunity for investors who can invest in companies one, two, three years before they IPO as they growing businesses which are increasing their market share. Businesses are staying private for longer and that’s a trend that’s been going on for a decade.”

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He said the firm was looking for companies which were seeking to list in the next few years and were already proven businesses, rather than early-stage businesses. It expected to review around 250-300 businesses each year and invest in around 2% of them.

“We want companies that have the intention to list in the next three or four years and we want to help bring our knowledge and expertise to help them on that journey,” Acton said.

“We are looking for proven established businesses with an established track record, at least three years, which are profitable or close to profitability. We don’t want those who are not early-stage companies or are loss-making.

“This could be companies in commodities, resources, industrials and consumers or in technology which is where we have seen the most notable contraction in multiples.”