Mestral Ventures has launched a new investment vehicle focused on small and medium-sized enterprises facing succession challenges. The fund is managed by Encomenda Capital Partners, the private equity firm led by Carlos Blanco and Mercè Tell.
The fund, Mestral Pymes Catalyst Fund 1.1, is designed to address one of the most pressing challenges facing Spain's business landscape: facilitating generational succession in SMEs.
"Around 70% of Spanish SMEs will face succession challenges over the next decade, and many will ultimately be sold. Through Mestral, we want to offer business-owning families an alternative. We will acquire majority stakes of between 60% and 80%, but unlike traditional search funds, we will keep the founding families as shareholders, allowing us to benefit from their deep knowledge of the business while enabling them to participate in the long-term value creation process," said Ernest Sánchez, Managing Partner of Mestral Ventures.
Mestral's investment strategy focuses on acquiring companies with significant growth potential and accelerating their transformation through digitalisation, operational efficiency improvements, the development of technology-enabled competitive advantages and, where appropriate, buy-and-build strategies aimed at integrating complementary businesses to create larger, more competitive groups.
The fund expects to invest in between 10 and 12 companies operating in traditional, fragmented industries with significant scope for technological modernisation, including light and heavy manufacturing, specialised distribution, B2B services, food, consumer goods, logistics, manufacturing and education. Individual investments will range between €5 million and €10 million.
Following each acquisition, Mestral will implement a 100-day value creation plan focused on three key priorities: technological transformation, management professionalisation and international expansion. The objective is to accelerate portfolio companies' growth and increase EBITDA, with target companies initially generating between €800,000 and €3 million in EBITDA.
About Mestral Ventures
Mestral Pymes Catalyst Fund 1.1 is a private equity fund managed by Encomenda and led by Ernest Sánchez, Marc Borrell and Jared Gil. The fund will invest in 10 to 12 Spanish SMEs undergoing succession processes, supporting their digital transformation, international expansion and professionalisation to unlock their full potential and create long-term value.
About Encomenda
Encomenda Capital Partners SGEIC S.A. is a multi-asset class investment management firm founded in 2015 and led by Carlos Blanco (CEO) and Mercè Tell (COO). The firm manages the Palladium Corporate Ventures, N Ventures I, Encomenda Seed II and Mestral Ventures funds.
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