Pipex boss Dubens floats £100m private equity fund
Saturday, 4 August 2007
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Peter Dubens, the executive chairman of broadband provider Pipex, floated a £100m private equity group on the Alternative Investment Market.
Mr Dubens raised the money for the new fund, called Oakley Capital Investment, by calling on a base of wealthy investors in America including Louis Bacon, a billionaire hedge fund manager, and Mark Kingdon, another US hedge fund heavyweight. It is thought that Terry Semel, former chief executive of Yahoo! and father of Eric Semel, a business associate of Mr Dubens who will be an operational partner at Oakley, has also put money into the company.
The venture is the latest in a string of companies for Mr Dubens. He sold Pipex's broadband business to Tiscali for £210m this year, and unloaded online gaming group 365 Media to BskyB for £107m in December. He built both companies up over the previous five years through more than 20 acquisitions.
He said: "This is my day job now. What I have been doing in the last few years basically is private equity, but doing restructuring and acquisitions in a public way it not always the cleverest way to do it. By issuing shares upfront we can make greater returns without being dilutive." The strategic review for Pipex's remaining web hosting, Wimax, and business services units would be wound up in "the next few months", he added.
He chose to float the firm rather than pursue the private partnership model typical of the buyout industry so that long-time backers like Invesco, Gartmore, GAM and Fidelity could invest in the business. Some institutions are barred from investing in private partnerships.
Mr Dubens expects to announce the raising of an additional £100m in private funds within two weeks. The firm's goal to is to raise a total of £400m. The publicly traded vehicle will be treated as a limited partner with the same rights as other investors in the rest of the fund. Mr Dubens and other founding directors and employees have pitched in £12m of their own cash.
Oakley will focus on the telecoms and internet sectors and intends on investing in seven companies. Mr Dubens said the firm would have a very "operational", hands-on approach. He has hired several key members of the nascent firm's team including Mark Joseph , a former managing director in the telecoms group at UBS, Alex Collins, formerly of GE Capital and private equity firm Advent International, and David Boyd, former head of investors relations at O2.
Invesco is the largest investor in the fund with a 25 per cent stake. Mr Bacon's Moore Capital and Kingdon Capitol Offshore own another 10 per cent each.
The float reflects AIM's status as the world's global growth market of choice. Last year 244 companies raised £14.3bn through new listings, more than the combined total of all of its global rivals.
Amid the market turmoil wrought by the meltdown of the subprime mortgage industry in the United States, larger offerings are struggling to get off the ground. Cunico for example, an Amsterdam mining heavyweight that hoped to achieve a $2.5bn market valuation with a listing this month, called off the listing because of the market downturn.
