HSBC Private Equity, the European private equity arm of HSBC, has raised £440m (€709m) for the first close of its new European private equity fund, from 12 investors.

The fund, launched in July 2001, has a target of £600m. Nine of the 10 investors in the firm's previous fund have committed to the new fund. The minimum investment in the fund is £25m. The firm expects two more investors to commit shortly, with a final close by the end of March. Funds raised from third-party investors will be matched by HSBC. The fund will target mid-market firms in the manufacturing and service industries. Half of the fund will be invested in the UK, and the remainder in the rest of Europe, mainly France and Germany.