AIB is to invest €10m in Erisbeg I LP, the flagship fund of the private equity business founded by former Blackstone and DCC executives in 2017.
The fund invests in small and medium sized Irish enterprises in the business services sector.
It brings to €110m the total amount injected into the fund, with €75m of that secured from a number of top tier European institutional investors in April last year.
Since then €35m has been added to it.
"This is a landmark investment from AIB, and we are delighted to be working with the AIB Equity Capital team," said Alan Kerr, the Erisbeg managing partner and former Blackstone executive who along with former DCC executive Thomas Davy founded the private equity firm.
"The fund is performing very well. Our portfolio is growing strongly, and we have identified a number of complementary acquisitions for portfolio companies."
Erisbeg has completed 11 transactions since it was launched six years ago.
Among its investments are a majority stake in logistics company Dixon International Transport, which has since acquired Monaghan based Carna Transport Limited.
It has also invested in health equipment distribution firm Medray, training and compliance business Chris Mee Group and specialised wireless communications provider, BP Multipage.
That firm has recently acquired Regional Electrical Maintenance Limited, which provides access control and security systems from its base in Co Meath.
Businesses in the Erisbeg portfolio have combined annual sales of over €130m, annual profits of €25m and employ close to 700 people.
It typically chooses to invest in small sized firms with earnings above €1m, with individual investments ranging between €5m and €25m.
Once it invests, Erisbeg typically works with existing management and shareholders of the business concerned.
"AIB is delighted to invest in the Erisbeg Fund and to support its plans to develop and grow its portfolio companies, supporting a growing number of jobs in Ireland," said Cathy Bryce, Managing Director of AIB Capital Markets.
