Leonard Green & Partners Closes on $1.25 Billion Private Equity Fund
9 October 1998
Leonard Green & Partners Closes on $1.25 Billion Private Equity Fund
LOS ANGELES--Oct. 9, 1998--Leonard Green & Partners announced the first closing of its $1.25 billion equity fund, Green Equity Investors III L.P., "GEI III."
LGP now manages the largest private equity fund in Southern California. The fund primarily targets management buyouts and recapitalizations of U.S.-based, growth-oriented companies, and it provides LGP with significantly more capital than its prior funds. Building upon the outstanding performance of GEI I and GEI II, GEI III was well-received by investors, enabling LGP to raise substantially more than its initial $750 million target.
Leonard Green, the firm's founding partner, commented: "The closing of this new fund comes at an opportune time. While capital has been relatively easy to access during the past several years, the recent turmoil in the world and U.S. markets has changed this dynamic. However, LGP's capital is available regardless of the state of the financial markets."
Green continued: "Our primary objective is to sponsor management buyouts and recapitalizations of growth-oriented companies and provide them with the capital required to pursue their business opportunities. We are targeting divisions of large corporations, publicly traded and privately controlled companies in a variety of consumer-oriented businesses, but will also opportunistically review many other situations. We have developed a particular expertise in transactions involving family-owned businesses which may have estate tax issues to solve. We expect our average equity investment to be between $75 million and $100 million, but can commit several hundred million dollars to a single transaction."
LGP was formed in 1989 and to date has invested in 18 companies in a variety of industries, including Thrifty Payless, a leading retail drug store chain that was subsequently sold to Rite-Aid Corp., and Twinlab Corp., a leading manufacturer and marketer of brand-name nutritional supplements that was taken public in 1996.
LGP has been very active during the past 18 months, committing a total of approximately $300 million of equity to six companies: Liberty Group Publishing, the nation's leading publisher of community newspapers; Diamond Triumph Auto Glass, the nation's third-largest automotive glass replacement company; Leslie's Poolmart Inc., the leading national specialty retailer of swimming pool supplies and related products; Wavetek Corp., a leading global designer, manufacturer and marketer of electronic-test instruments; Hechinger/Builders Square, the third-largest home-improvement retailer in the United States; and Gart Sports' acquisition of Sportmart to create the nation's second-largest sporting goods retailer.
Since its formation, LGP has completed transactions with a total value of approximately $5.6 billion.
Leonard Green & Partners L.P. is a Los Angeles-based private equity investment firm managed by six partners who collectively have more than 100 years of merchant and investment banking experience. The first closing of GEI III consisted of more than $1.0 billion, with the remainder scheduled to close later in 1998. For further information, contact Jim Gillette, chief financial officer, at LGP in Los Angeles at 310/954-0444.