Blue Sky Funds Management is seeking to raise $50 million from investors, including self-managed superannuation funds (SMSF) and institutions, for a new fund that invests in small to medium enterprises (SME) in Australia.
The Blue Sky Private Equity EC2010 Fund helps SMEs grow by providing them with capital to expand and management expertise.
Two businesses already in the firm's current portfolio, Lenard's Chicken and Viking Rentals, form the cornerstone investments of the fund.
"Nearly a third of the capital raised will be used for proven assets, which will start working for the fund straight away," Blue Sky Private Equity managing director Tim Wilson said.
"The remaining capital raised by Blue Sky will be invested in new portfolio companies and used to help them expand either organically or through acquisition."
Wilson said the current climate was perfect for investing in private equity.
"Private equity is an effective way for companies to grow, and this is especially the case in the current economic environment where bank debt is more difficult to source," he said.
"Australia has weathered the downturn well and this presents investee companies and investors alike with a unique opportunity to achieve strong returns."
SMSFs were among the target market for the fund as that's the space the company has operated in, Wilson said.
"Additionally, we have identified the SMSF space as one where there is a lack of alternative investment opportunities relative to say the institutional world, which has a much higher allocation to alternatives," he said.
The fund will look to partner with five to 10 businesses overall and the minimum investment is $10,000.
Wilson said the fund will not be a liquid investment.
