Compass Group Equity Partners has held a first and final closing of its third fund, Compass Group Fund III LP, at its hard cap of $408 million.
Compass Group began raising Fund III late last year and is the firm’s second fundraising effort in the past two years and follows the closing of its second fund in April 2022 at its hard cap of $255 million. Fund II was the firm’s first pooled fund and was so named as Compass has invested more than $200 million under an independent sponsor model since 2015.
Investors in Fund III include insurance companies, endowments, registered investment advisors, and foundations, and included many Fund II limited partners.
“We are very proud of the firm we’ve built over the last decade. Hard work and dedication from the team has helped us deliver on our strategy of thematic research, proprietary deal sourcing, partnering in value creation, and ultimately successful outcomes,” said Managing Partner John Huhn. “The support from our limited partners validates our investment strategy, our people, and the strength of our portfolio. We are appreciative of both new and existing investor support that enables us to continue our mission to grow great companies.”
Since the firm’s first investment in 2015, Compass Group has invested in 14 portfolio companies, closed more than 235 add-on acquisitions, and completed 4 exits with the sales of Sunpro Solar, a Louisiana-based provider of design, installation and maintenance services for residential and commercial solar panels, to ADT in December 2021; Compass Electronics Solutions, a Minnesota-based contract manufacturer of electronic components, in January 2022; Tipton Mills, an Indiana-based provider of private label and co-packing services for functional food and beverages, in September 2019; and The Allied Group, a Rhode Island-based outsourced provider of diagnostic kitting services including design, print, assembly, and fulfillment, to healthcare and life science companies, in May 2022.
Compass Group invests up to $50 million of equity in Midwestern-headquartered companies that have enterprise values of $20 million to $100 million and EBITDA of $2 million to $12 million. Sectors of interest include niche manufacturing and distribution, and business and consumer services. Compass Group was founded in 2014 and is headquartered in St. Louis.
Aqueduct Capital Group was the placement agent for this fundraise and McGuireWoods provided legal services.
© 2024 Private Equity Professional | April 11, 2024
