John Penning (Luxempart): Luxembourg’s pioneer in private equity investments
Founded more than three decades ago, Luxempart S.A. is one of Luxembourg’s leading investment companies and a pioneer in private equity. John Penning, Managing Director, shares how the firm combines long-term vision with entrepreneurial agility, explains its two-pillar investment strategy, and reflects on Luxembourg’s evolving role in the global private equity landscape.
What is Luxempart’s investment strategy in the lower mid-market buyout space?
Luxempart invests directly in small to mid-sized companies across Continental Europe, typically taking active minority or co-control positions, and occasionally majority stakes alongside like-minded investors, entrepreneurs, and managers. Our Direct Investments portfolio focuses on companies with enterprise values between €100 million and €500 million, with initial equity tickets ranging from €25 million to €70 million. We actively support management teams over several years and remain flexible in managing liquidity to accommodate the needs of our partners and entrepreneurs. Our Investment Funds pillar, representing about one-third of our portfolio, backs top-quartile private equity fund managers active in the lower mid-market buyout and growth segments. This strategy gives us exposure to the expertise and local insight of leading teams while investing in company types and sizes familiar from our direct investments. We are currently strengthening our portfolio of managers in the United States while maintaining long-term relationships with key European partners.
“Owning Luxempart shares gives exposure to distinctive private assets and top-tier lower mid-market managers.”
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Why is buying Luxempart shares a unique way to gain exposure to private equity?
Unlike traditional funds that raise capital from institutional investors, Luxempart is a listed investment company on the Luxembourg Stock Exchange, backed by entrepreneurial families since 1992. This permanent capital structure of €2.3bn provides stability and enables us to invest with a long-term perspective, independent of fundraising cycles. Anyone can buy Luxempart shares on the market and gain exposure to a distinctive portfolio of private assets and top-tier private equity managers that are typically difficult to access. For example, Luxempart holds a significant stake in Luxembourg’s leading insurance group, Foyer, offering our shareholders indirect exposure to this sector. Combined with our annual dividend, Luxempart shares offer a liquid entry point into an inherently illiquid asset class that has historically outperformed public markets over the long term.
Is Luxembourg a good place to do private equity from?
Luxembourg has long been a major financial center and continues to strengthen its position in private and alternative assets. Beyond its well-established back and middle-office infrastructure, we now see a growing number of front-office investors choosing Luxembourg as their base. Recent government proposals for a revised and competitive carried interest regime—a key mechanism aligning the interests of investors and fund managers—are particularly encouraging. As a pioneer of private equity investment in Luxembourg, Luxempart fully supports such initiatives, which enhance the ecosystem and attract international talent to the country.