Butler Capital Partners, the Paris-based private equity fund run by former Goldman Sachs executive director Walter Butler, is to launch three funds worth €700m (£625m) in the new year.
It is understood that the biggest of these funds, worth €400m, will focus on buying companies in desperate need of being turned around as a result of the credit crunch.
The other two funds, expected to be worth €150m each, will focus on buying cheap debt in struggling firms. These loans would either be sold on at a profit once the market improves or be used as leverage to take a majority stake in the target at a later date.
A French source said the funds would focus on "big consumer opportunities" – areas such as leisure and retail – which have been particularly hard hit by the market turmoil.
The funds are likely to focus on the French market, though the company raising the money on behalf of Butler is believed to be the London office of MVision.