NEW YORK -- Granville Private Equity Funds has hired Gary H. Solomon as chief executive officer and will open a New York office for the London-based fund-of-funds operation.
A 12-year veteran and partner at Abbott Capital Management, New York, Mr. Solomon will identify U.S. private equity funds and market to prospective U.S. clients.
Mike Proudlock, chief executive of Granville Private Equity, a unit of investment banking group Granville PLC, said opening the U.S. office recognizes the growing importance of U.S. capital in international private equity.
"Now there's a huge amount of capital coming into the private equity business, and the great majority of it is coming out of the U.S.," he said.
Having a greater U.S. presence also should help Granville research U.S. funds and market that expertise to U.S. investors, Granville officials said.
"It's very hard to invest in the U.S. funds if you're not in the U.S.," Mr. Solomon said.
Mr. Solomon, who left Abbott in December, will not be replaced, although Katheryn Stokel -- formerly a portfolio manager in the alternative investments area of General Motors Investment Management Corp. -- recently joined the firm as a managing director.
The funds division of Granville Private Equity manages L244 million ($407 million), mostly for U.K. clients. It was formed in 1993 when Hermes Pensions Management Ltd. (then known as Postel) handed over L50 million in private equity interests to manage. Subsequent mandates include a L60 million global mandate for Guardian Asset Management, London.
Another L60 million is invested in managing partnerships in the secondary market.
Later this year, Granville will seek to raise $100 million to $150 million from U.S. and European investors for a fund-of-funds that will invest primarily in western Europe, but also some in central Europe. The fund is expected to invest in 10 to 15 funds, mostly buyout funds but possibly venture capital pools as well, Mr. Solomon said.
Mr. Solomon said he will coordinate with his three-person London-based team by "phone, fax and e-mail." He expects to hire two more analysts.
Meanwhile, Granville Private Equity Managers -- the direct investment arm -- plans to launch a L200 million fund later this year that will invest mostly in the United Kingdom but significantly in continental Europe, said Mike Fell, managing director.
The direct investment side has developed a sector focus on telecommunications; outsourcing; software and computing services; and transportation, logistics and distribution.
Recent investments include stakes in: Ora Electronics (UK) Ltd., Britain's largest mobile telecommunications accessories supplier; SII, a French information technology services company; and Elmeg GmbH Kommunikationstechnik, Germany's leading manufacturer of small ISDN telephone exchanges and line testing equipment.
While a growing number of private equity pools have reached the $1 billion-plus range and thus are seeking bigger deals, Granville officials are committed to sticking with the middle market.
The development of megafunds has "opened up a gap in the midmarket," Mr. Fell said, defined at about L25 million to L100 million.
Granville also has been expanding into continental Europe, particularly in Germany, where it set up a joint venture 18 months ago with Hamburg-based mergers and acquisition adviser Steffens Alvano & Partner GmbH.