Luke Johnson, the Channel 4 chairman and investor, is considering raising his first fund to invest in UK companies, mostly in the leisure, consumer and business services sectors.
Mr Johnson said on Wednesday that he and his company, Risk Capital Partners, had not yet decided whether to raise a fund but were examining the costs and interest from investors for a £100m fund. A decision would be made in the next few months.
“We did have a number of investors and investment placement agents ask us if we were interested in raising a fund, and that inspired us to think about it,” he said.
Mr Johnson, who is an FT columnist, added that in recent months RCP had seen an increase in its deal flow that had made him more confident that he could find good investments within three to four years.
“We always wanted to avoid the situation where you might be forced to invest because you have money burning a hole in your pocket,” he said.
If RCP does create a fund, it will look to make returns of about 25 per cent after management fees.
RCP uses mostly Mr Johnson’s personal money and that of its three partners – Mark Farrer-Brown, Ben Redmond and Paul May – although it has occasionally co-invested with bigger private equity companies or individuals with large amounts of capital.
So far, RCP has concentrated on investments in which it can use a roll-out, buy-and-build or turnround strategy to increase the value of a company.
Patisserie Valerie is one recent example. Having bought the chain of upmarket London cafés in September last year, when it had eight stores, it now has 52, after acquiring Druckers Vienna Patisserie – a Midlands-based chain – and new site openings.
If RCP proceeds with raising a fund it will not restrict itself by sector but will look only at UK investments. Since its beginning in 2001, £10m has been the upper end of what it would invest per deal. If it raises a fund it will tend to be interested in investments of about that size.