Aterian Raises New Fund in Rapid Fashion
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Aterian Raises New Fund in Rapid Fashion

Start-to-finish, Aterian's fourth fund is raised in just nine weeks

Middle market investor Aterian Investment Partners has closed its fourth fund, Aterian Investment Partners IV LP, with over $830 million of capital commitments.

According to Aterian, as a result of strong support from both existing investors and a targeted group of new investors, its new fund was launched and closed in just nine weeks. Limited partners in Fund IV include endowments, foundations, family offices, insurance companies, pension plans and fund-of-funds across North America, Europe and Asia. The firm’s earlier fund, Aterian Investment Partners III LP, closed in July 2018 with $350 million of committed capital.

Aterian was founded in 2009 by its co-founders Brandon Bethea, Michael Fieldstone and Christopher Thomas and has offices in New York City and Coral Gables, Florida. Throughout its history, Aterian has posted strong investment returns.

“The Aterian team is incredibly thankful for and humbled by the continued support from our existing investors and the relationships built with a select group of new investors,” said the three co-founders in a statement provided to Private Equity Professional. “We are grateful to have partnered alongside remarkable companies, managers, family/founders and sellers who share our values by building trust, being impactful, fostering vibrant cultures and succeeding as one team. We are also appreciative of our extended strategic relationships including the investment bankers, lenders and advisors that share in Aterian’s development as a firm.”

Like its earlier funds, Fund IV will invest up to $70 million in small-to-middle market businesses with $25 million to $500 million in revenues that are underperforming, turnarounds or in unique situations.

Aterian’s fourth fund has not yet closed on any new platform investments. Across the firm’s three earlier funds, Aterian has acquired twenty platforms, exited four, and remains invested in sixteen companies – one in Fund I; nine in Fund II; and six in Fund III.

The six Fund III portfolio companies include Kane Infrastructure Services, a New Jersey-based provider of structured cabling services which include the installation, replacement, and maintenance of telecommunications networks, acquired in 2021; Rogers Mechanical, a Georgia-based provider of plumbing and HVAC mechanical services to the distribution center market, acquired in 2020; Bright Innovation Labs, an Arizona-based formulator and contract manufacturer of personal care, cosmetics, and hair care products, acquired in 2019; Eaglestone, a New York City-based portfolio of companies providing plumbing, HVAC, and mechanical services, acquired in 2019; TableTrust Brands, a Pennsylvania-based farm-to-fork portfolio of natural and kosher food companies, acquired in 2019; and US Zinc, a Texas-based maker of zinc products including zinc oxide and zinc dust, in 2018.

With the close of Fund IV, Aterian has now raised total capital commitments of over $1.5 billion and has invested in over 40 businesses.

“We could not be prouder of each member of Aterian’s twenty-three-person team that has been working tirelessly to create tremendous value across the portfolio.  Each of us is excited to continue that effort on behalf of our investors in Fund IV,” concluded the three co-founders of Aterian.

Kirkland & Ellis provided legal services on this fundraise.

© 2021 Private Equity Professional | October 12, 2021

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