York Closes New Special Opportunities Fund

York Capital Management has closed its third and largest ever North American middle-market special opportunities private equity fund, York Special Opportunities Fund III LP (Fund III), with total capital commitments of $800 million.

Like its prior funds, Fund III will make control investments of $35 million to $200 million in middle-market businesses. York’s special opportunities funds are generally sector agnostic, but the firm does have a specific interest in the automotive, building products, business services, chemicals, specialty finance, energy, health and wellness, industrials, transportation and logistics, and resort and hospitality sectors.

Since York launched its special opportunities strategy in 2008, it has acquired over 20 businesses and platforms. York’s second special opportunities fund closed in 2014 with $700 million of capital and its first special opportunities fund closed in 2008 with $500 million of capital.

“We are grateful for the strong institutional support from both longstanding York clients and new investors to Fund III,” said Zalmie Jacobs, a partner at York and the head of private equity. “We are eager to bring our financial and operational expertise to bear and assist companies and management teams in navigating these turbulent times and executing their growth strategies. Our investment team has deep experience in varying market conditions and also benefits from the capabilities and investment insights of York’s global platform.”

York’s newest fund has just closed on its first investment with the buy of The Good Feet Store, a Carlsbad, California-headquartered manufacturer and franchise retailer of personalized arch supports and related products. According to York, it is the second-largest brand in the fast-growing $1.5 billion orthotics insert market. There are more than 150 Good Feet stores, over 90% of which are franchised.

York Capital was founded in 1991 by CEO Jamie Dinan and is headquartered in New York City with additional offices in Hong Kong and London. “This is a great time to have substantial dry powder and a team experienced in supporting management amid market disruptions and an uncertain climate,” said Mr. Dinan. York Capital now has more than $18 billion in assets under management with 60 investment professionals, 15 of which are dedicated to special situations, and a total of 200 employees.

With the closing of Fund III, York has announced that Harish Nataraj has joined the firm as a managing director. Prior to joining York, just a few months ago, Mr. Nataraj was a partner and managing director at Angelo Gordon’s private equity group, where he led investments in the financial services, consumer, healthcare services and business services industries. Earlier in his career, he was an associate at Kohlberg & Company.

Campbell Lutyens & Co. was the placement agent on this fundraise and Kirkland & Ellis provided legal services.

Private Equity Professional | April 24, 2020

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