Lyceum Capital, the UK mid-market investor, is understood to have called time on its current fundraising effort and will invest on a deal-by-deal basis going forward.
The firm kicked off fundraising for its fourth fund last year, but is believed to have halted the process after a significant number of its Fund III investors decided not re-up in the new vehicle for internal reasons not related to Lyceum. It is understood that many international LPs have also taken a cautious position on the UK because of Brexit uncertainty.
Lyceum closed its previous fund on around £300m in 2013. It was targeting between £375m and £400m for Fund IV.
Real Deals understands that Jeremy Hand and Simon Hitchcock will now lead the firm as co-managing partners, with Lyceum investing on a deal-by-deal basis in technology and technology-enabled services companies.
The firm is expected to see departures following the news, but final details on who will be leaving are still to be confirmed.
Lyceum will continue to manage its existing portfolio and has committed capital available to do so. The firm is said to have seven bolt-on targets in exclusivity across four platform companies at the moment.
Lyceum has almost fully-exited its 2008 second fund, which has made seven exits and delivered returns of 2.6x money to date. Fund III is close to fully invested and was deployed predominantly over the last two years. The Fund III portfolio is said to be valued at 1.5x cost at this stage.
“This news comes as a surprise. This is a very reputable firm that is well-established. You would expect them to raise,” one source said.
At the end of 2016 Lyceum sold digital security business Clearswift to RUAG. It also exited Compact Media Group, a collection agent for audio visual secondary rights, to Toronto-based Ole and passed on cloud services provider Adapt to Abry-backed Datapipe in 2016.