AEA Investors Small Business Private Equity Closes Fifth Fund Above Target at $1.3 Billion
Positions AEA SBPE to Build on Track Record as a Partner for Growing, High-Quality Industrial, Consumer and Services Businesses
NEW YORK, Oct. 5, 2023 /PRNewswire/ -- AEA Investors LP ("AEA"), a leading alternative investment manager specializing in middle market private equity, growth capital and debt investments, today announced it has successfully closed its fifth Small Business Private Equity ("AEA SBPE") Fund, AEA Investors SBF V ("AEA SBF V" or the "Fund"), with more than $1.3 billion in total equity commitments, significantly exceeding the Fund's target of $1.0 billion. AEA SBF V represents an increase of over 50% of third-party capital from AEA Investors SBF IV, which closed in March 2019.
The oversubscribed fund received strong support from both new and existing investors comprising a broad range of leading global institutions, including public and private pension plans, asset managers, financial institutions, insurance companies, fund-of-funds, endowments and foundations, family offices and high net worth individuals. Demonstrating alignment with its investors, the General Partner committed approximately $175 million in capital alongside AEA SBF V limited partners.
The Fund will continue to build on AEA's SBPE strategy and strong track record of partnering with growing lower middle market companies, primarily in the U.S., within the industrial, consumer and services sectors. AEA SBF V seeks to partner with highly capable existing management teams – in many instances as first institutional capital – to support and accelerate the growth of companies with superior business models and transform them into institutional enterprises and enduring market leaders. The Fund will generally pursue control equity investments ranging from $50 to $100 million in companies with enterprise values of less than $500 million.
AEA SBF V will also continue to leverage the insights and support of AEA SBPE's dedicated Executive Partner program, comprised of a network of highly successful industry executives with deep domain and sector experience. As a trusted resource alongside the AEA SBPE investment team throughout the investment lifecycle, the AEA SBPE Executive Partner network has historically provided significant sourcing advantages, industry insight and hands-on support for management teams from investment ideation through realization. Over the last decade, nearly 70% of AEA SBPE investments have involved an Executive Partner in both proprietary as well as intermediated processes, which AEA believes has positioned its portfolio companies for continued success.
"We believe our conviction in the lower-middle market, combined with our partner-oriented mindset and distinct differentiators – including our leading executive network and extensive track record – continues to position AEA SBPE as a strong partner for quality family- and founder-led companies," said John Cozzi, Partner and Co-Founder of SBPE at AEA Investors. "The close of our largest Small Business Fund to date is a testament to our team's ability to source and support attractive lower middle market companies and strong management teams to build stronger, higher-performing businesses that are positioned for success through all market cycles."
"We are grateful for the continued support from so many new and existing investors," said Baron Carlson, Partner and Co-Founder of SBPE at AEA Investors. "In response to a more dynamic and challenging market, our team has worked diligently to underscore our track record of enabling our companies to take share through all economic environments and position them for long-term growth. We believe this highly successful close will enable us to grow our platform, capitalize on the numerous compelling opportunities ahead and continue to provide critical, strategic support and resources for our partner companies."
AEA SBPE also has a long history of partnering with family- and founder-led businesses. Since establishing the AEA SBPE platform in 2004, approximately 70% of its investments have been in support of family- or founder-led companies, including PLZ Aeroscience, Colony Hardware, National Rehab Equipment, Implus Footcare, Phillips Pet Food & Supplies, The Evans Network of Companies, Flow Control Group, SGL TransGroup, Barnet Products, Montway, 50 Floor, Meritus Gas Partners, Unisyn Precision Components, Rees Scientific and Chemtron RiverBend.
In addition to the successful close of AEA SBF V, AEA SBPE also closed on $384 million in total capital commitments earlier this year for its first continuation fund, AEA SBP CF LP, bringing aggregate total capital commitments to more than $1.7 billion for recent fundraises across the AEA SBPE platform. In April 2023, AEA SBP CF LP, alongside AEA SBF V and AEA Investors SBF IV, acquired a majority interest in Singer Industrial (formerly known as SEI Holding Corporation or SBP), a leading value-added distributor of industrial rubber and fluid power products, in a strategic move designed to fuel the company's growth and expansion, while accelerating its robust M&A strategy.
AEA's Small Business Private Equity team currently manages over $3 billion of invested and committed capital. To date, AEA SBF V has completed three platform investments in Chemtron RiverBend, a full-service provider of water and wastewater treatment products and services; Crane Engineering, a leading distributor for highly engineered pumps, valves and related flow control and fluid handling products; and Singer Industrial.
Kirkland & Ellis served as fund counsel. AEA SBF V engaged no intermediary to assist in fundraising.
About AEA
AEA Investors LP was founded in 1968 by the Rockefeller, Mellon and Harriman family interests and S.G. Warburg & Co. as a private investment vehicle for a select group of industrial family offices with substantial assets. AEA has an extraordinary global network built over many years which includes leading industrial families, business executives and leaders, many of whom invest with AEA as active individual investors and/or join its portfolio company boards or act in other advisory roles. Today, AEA's approximately 110 investment professionals operate globally with offices in New York, Stamford, San Francisco, London, Munich and Shanghai. The firm manages funds that have approximately $19 billion of invested and committed capital including the leveraged buyouts of middle market companies and small business companies, growth capital and mezzanine and senior debt investments. AEA SBPE is a strategy within AEA that currently manages over $3 billion of invested and committed capital. The team seeks to help grow and transform companies at the lower end of the middle market by sponsoring growing companies with strong management teams and superior business models.
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SOURCE AEA Investors
