Blue Sage Capital has held a final closing of its fourth fund, Blue Sage Capital IV LP (Fund IV), with $618 million of capital. The new fund closed above its original $400 million target and its original hard cap of $550 million.
Blue Sage raised Fund IV without a placement agent and limited the fund’s size to maintain its focus on lower-middle market investments, despite strong limited partner interest generated within just a few months of fundraising.
Fund IV’s limited partners include college and university endowments, charitable foundations, pension funds, large family offices, insurance companies, and entrepreneurial individuals. Many of these limited partners have a longstanding relationship with Blue Sage, dating back to the firm’s founding nearly 25 years ago.
“We are humbled by the consistent support of our limited partners and look forward to continuing to generate strong returns for them and their stakeholders who are investing their capital alongside ours,” said Peter Huff, the founder and managing partner of Blue Sage. “We maintain a deep sense of responsibility to our limited partners who have placed their trust in our team. We are grateful for their partnership and look forward to continuing to build truly exceptional portfolio companies by collaborating with outstanding management teams.”
Blue Sage’s earlier fund closed in September 2020 at an oversubscribed, and above target $300 million, and its second fund closed in December 2012 with $150 million of capital. With the close of Fund IV, the firm has now raised over $1.2 billion since its inception in 2002.
Austin, Texas-based Blue Sage specializes in partnering with founders, families, and management teams as the first round of institutional capital for businesses in the niche manufacturing, environmental solutions, or specialty services industries. The firm typically invests from $25 million to $60 million in control buyout investments and recapitalizations of companies with $5 million to $25 million in EBITDA and $25 million to $200 million in revenue.
Kirkland & Ellis provided legal services to Blue Sage on the Fund IV fundraise.
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