Synova closes £875m fund, plans to boost investment in education
Private equity firm Synova has held a first and final close for its latest fund, Synova V, which will dedicate a portion of its capital to invest in the education sector.
The fund surpassed its £750 million target and hit its £875 million hard-cap after only three months on the road. Its predecessor, Synova IV, closed on £365 million in 2019.
Synova V will target mid-market opportunities across the education, healthcare, technology, business services and financial services industries. In addition to companies based in the UK and Ireland, the vehicle will also be seeking platform opportunities in continental Europe.
“With our latest fund, we plan to continue to invest in education, which represents a key sector for us, identifying high-growth opportunities and fuelling their expansion with financial and managerial support,” David Menton, founding and managing partner of Synova, told EducationInvestor Global.
Synova has a team dedicated to the education sector and already owns two companies in this space: Chatsworth Schools, an independent schools operator backed by Synova III, and National Education Group, a provider of online CPD training for schools and global education institutions, which is part of Synova IV’s portfolio.
With the aim of supporting companies throughout their growth trajectory, Synova will reserved £250 million of the total capital raised, the Chrysalis pool, for investments in smaller companies. According to the firm, this strategy will allow the fund to capitalise on the best opportunities in this segment of the market as well as provide a strong source of incremental returns for investors.
“The Chrysalis pool within our Synova V fund allows us to support smaller companies ready to scale and accelerate their growth trajectory,” Menton told EducationInvestor Global. “This might be particularly vital across the education sector, which includes several good assets of smaller size, in need of backing and support from a financial sponsor that also has strong expertise in the education sector.”
Synova V received support from both existing investors, which increased their commitments by over 50% on average, and a pool of new investors, in a fundraise that was heavily oversubscribed, according to the firm. Investors were attracted by the performance of Synova’s prior funds, which achieved average realised returns of 6.2x the invested capital.