Quadrant’s new fund, which will take minority positions in growing mid-sized companies, is testament to three of the big trends driving Australian capital markets.
The fact Quadrant Private Equity’s new strategic equity fund garnered twice as much interest as executive chairman Chris Hadley expected is testament to three of the big trends driving Australian capital markets: the rise and rise of private capital; the reluctance of leading private companies to list on the ASX; and the impressive growth of Australia’s mid-market.
The fund, which closed on Friday, represents a back-to-the-future moment for Hadley and Quadrant; the firm’s first three funds in 1996, 1998 and 2001 all took minority positions, and delivered internal rates of return of between 24 per cent and 94 per cent.are staying private for longer “The threshold to be a listed company gets higher, from a regulatory perspective as well as from an actual scale perspective,” Hadley says.been shut for the best part of 18 monthsQuadrant and its competitors have been good at finding mid-sized companies that are willing to sell the majority of their equity. But Hadley says many firms want to retain control as they seek to turbocharge their growth.
While he acknowledges there is a different approach required in minority investing, Hadley is confident that the partnering approach it uses on majority deals will translate. “These periods can be good for some businesses to grow. Well capitalised, well run businesses can grow in these markets, too.”
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