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Merchant Banking

Corporate Private Equity

Our investment strategy

We focus on the European lower middle market, a traditional stronghold of Rothschild & Co. We look for companies valued between €50 and €500 million, where we seek to deploy equity tickets of €40 to €100 million per investment. In addition, we have the ability to commit substantially more than €100 million to a single transaction upfront, thanks to extensive co-investment agreements with our investors.

We believe the middle market holds the greatest pool of businesses that meet our risk appetite and yet have significant headroom for further growth.

We seek to support businesses across Western Europe. We primarily focus on either 'domestic franchises' - high-quality businesses with significant under-penetration in their local jurisdictions - or 'export champions' - businesses with strong local market positions but with offerings that can be internationalised.

We have found that both types of businesses can benefit from the combination of our local, 'on the ground' networks and global reach.

We invest alongside partners, including entrepreneurs, family owners, management, financial sponsors and corporates. We are flexible about the situations that we look to invest in, which include growth capital, replacement capital and traditional buyouts. We use financial leverage where appropriate and always with utmost care and conservatism.

We look for high-quality companies led by talented management teams who care deeply about the businesses they run. Specifically, we seek businesses which:

  • Have an entrenched and sustainable competitive position
  • Have a track record of generating attractive returns on invested capital and free cash flow across multiple economic cycles
  • Benefit from positive structural market trends, providing high visibility on expected volume growth
  • Present multiple untapped levers for operational improvement or corporate development

The composite picture is one of companies with recurring, predictable and visible revenues and cash flows.

Our targeted business characteristics are typically found in asset-light service businesses or product businesses which have a strong service component. We particularly focus on and have deep experience and perspectives in the following sectors:

  • Healthcare
  • Data and Software
  • Technology-Enabled Business Services

Within these, we are focused on specific sub-sectors that best meet our investment criteria.