Arbor Closes Third Food And Beverage Fund At $400M Hard Cap
December, 21, 2011 · Dow Jones LBO Wire
By Laura Kreutzer
CHICAGO - Arbor Private Investment Co., a Chicago-based buyout firm focused on investments in the food and beverage industries, has wrapped up its third fund at the fund’s $400 million hard cap.
The final closing of Arbor Investments III LP came in well head of the fund’s $300 million target. One person said that the firm could have raised a $500 million fund had it not hewed to the fund’s hard cap.
Vice President Kimberly Harrod said that the firm did have to turn some investors away but added that roughly two thirds of the investors in Fund III were new to the firm.
“We were happy to see an endorsement of the strategy,” Harrod said.
Arbor held a first closing of the fund in June and a second closing in September before wrapping up the fund in December.
Shannon Advisors placed the fund.
At $400 million, Fund III is nearly double the $234 million portfolio that Arbor manages for its prior fund. That capital includes $170 million fund that closed in 2006 and a $64 million pool of co-investments. Given the increase in fund size, the firm will likely target slightly larger deals, namely companies with earnings before interest taxes depreciation and amortization of between $10 million and $30 million, according to Harrod. With its prior fund, Arbor’s sweet spot was more in the ebitda range of $5 million to $20 million, she added.
Arbor targets three separate segments within the food and beverage industry: private label products, food services and food and beverage brands.
Before launching Arbor in 1999, co-founders Gregory Purcell and Joseph Campolo worked together at the mergers and acquisitions division of beverage company Reyes Holdings LLC. Before that, they worked together at American National Bank of Chicago (now part of J.P. Morgan Chase & Co.).
Reach Arbor Investments at 312-981-3770.