Taylor, a 20-year veteran of 3i Group plc, joined Ontario Teachers' Pension Plan's buyout arm in January and has since struck two sizeable deals in the Nordic region and unexpectedly fallen at the last hurdle to a midcap leisure takeover in the U.K.

"We like beer-drinking rather than wine-drinking countries," he said, "so the U.K., Benelux, Scandinavia and Germany are fine. I suspect Central Europe will become an area that we more closely evaluate over the next two years, particularly Poland and the Czech Republic. We're avoiding southern Europe -- we see that as more of a challenging environment to do things on a predictable basis."

This year in Europe, Teachers' Private Capital has bought a majority stake in Norwegian sportswear maker Helly Hansen Group AS from Sweden's Altor Equity Partners in a deal that valued the company at more than 2 billion Norwegian kroner ($350 million). It has also spent about €350 million ($455 million) on a roughly 20% stake in Danish cleaning and support services company ISS A/S, diluting EQT Partners AB and Goldman Sachs Capital Partners' majority holding after their £5.2 billion ($8.5 billion) sale of ISS to the U.K.'s G4S plc spectacularly collapsed in November following a G4S shareholder rebellion.

In August Teachers' recommended £73.1 million takeover of Scottish five-a-side soccer company Goals Soccer Centres plc was unexpectedly rejected by the target's shareholders, a disappointing end to a four-month courtship that for Taylor highlights the difficulties of acquiring listed U.K. entities following last year's changes to the Takeover Code. (The changes require that a bidder's identity accompanies a target's first disclosure of takeover interest, and the suitor must work to a 28-day deadline to proffer a fully funded offer or retreat. The changes also banned breakup fees in most circumstances.)

"Under the new rules you have to put in a lot of money, time and effort before you can have a serious conversation with your target company," he said. "These transactions aren't for the fainthearted."

Taylor declined to comment on the likelihood of a future Teachers' bid for Goals.

"We liked the team and could see value in the business going forward," he said. "We felt we'd made a fair and appropriate offer and had been hopeful that it would have been seen in that light."

About 50% of Teachers' Private Capital's investments are made in other buyout firms' funds, including those of EQT and BC Partners; around 25% comprise co-investments with other firms; and with about 25%, Teachers' invests directly and by itself.

Teachers' seeks to forge multifaceted relationships with its buyout fund partners. "Sometimes we bring deals to them. Because we are seen as more of a pension fund, there will be vendors and regulators that maybe see us as a more suitable partner than a regular private equity firm," he said.

Taylor argued that the backing of Canada's largest single-profession pension fund, which has close to $120 billion of assets under management, gives it flexibility that other buyout firms don't have.

"We're not a fund, and we have very liquid capital, which we can deploy as we require but we have no obligation to invest if we don't see things we like," he said. "We don't have exposure issues or issues in terms of majority or minority investments, and we can take a very long-term horizon."

Teachers' Private Capital has operated since 1991 and in the past 21 years has delivered returns averaging just under 20% from its portfolio companies. As of December 2011, it had an investment portfolio worth about $12.5 billion. It typically invests between €70 million and €400 million per transaction.

Teachers' August deal to take a stake in ISS arose out of its relationship as an investor in EQT funds.

"We had discussed with them a few companies in their portfolio that we liked. ISS was one," Taylor said. "We've taken a serious minority stake in a fantastic business that has very strong defensive qualities. We view it as a business that will be very listable."

The funding from Teachers' and from Denmark's Kirbi A/S was used to repay about 3.9 billion Danish kroner ($679.6 million) of ISS senior notes.

Teachers' will also give the cleaning and support services company opportunities to expand its revenue through its network of portfolio companies, including Copenhagen Airport and mall owner, Cadillac Fairview Corp.

With Helly Hansen, Teachers' wants to help the Norwegian brand crack the North American market.

Speaking from Teachers' European head office in London's upscale Mayfair district, Taylor sees the region's protracted economic malaise as potentially fruitful.

"There will be some interesting things available to those who are able to take the time and do the diligence on the targets -- including regulator-mandated divestments, large corporates looking to do joint ventures, and assets currently owned by other PE firms. For us, the question is about whether you can acquire assets where there is still value in the business."