New Mountain Said to Get More Than $1 Billion for BuyoutsSabrina Willmer
New Mountain Capital LLC, the private-equity firm founded by a former Goldman Sachs Group Inc. executive, has raised more than $1 billion for its latest buyout fund, said three people familiar with the matter.
New Mountain Partners IV LP, which has a $3 billion goal, can gather a maximum of $5 billion, according to the people, who asked not to be identified because the information isn’t public.
The firm, which sent out marketing documents for the fund in November, is gathering money in a competitive climate as some limited partners cut back on the number of managers they use. A record 1,990 private-equity funds were seeking a combined $721 billion as of the start of October, according to London-based research provider Preqin Ltd.
David Coquillette, a managing director at New York-based New Mountain, declined to comment on the capital raising.
The firm’s prior fund raised more than $5.1 billion and began investing in August 2007. It made the bulk of its deals from 2010 to 2012 and so has yet to begin generating returns from many of them, said two of the people.
New Mountain Partners III LP was generating a multiple of 1.2 times invested capital and an 8.5 percent net internal rate of return as of June 30, according to performance data from Oregon Public Employees Retirement Fund. The second fund was producing a multiple of 2 and a return rate of 14 percent as of the same date. The firm raised $1.55 billion for Fund II, which started investing in January 2005.
New Mountain last year sold Deltek Inc., a provider of computer software for government contractors, to private-equity firm Thoma Bravo LLC in a $1.1 billion deal.
Earlier this year, New Mountain managing director Alok Singh departed to help start private-equity firm Bridge Growth Partners LLC. He is the only investment professional on a staff of 60 to ever leave New Mountain, said one of the people.
New Mountain typically purchases three to four middle-market companies a year, investing $100 million to $500 million in each deal, according to the firm’s website. Steven Klinsky, a co-founder of Goldman Sachs’s leveraged-buyout group in the 1980s, started New Mountain in 1999 and the firm began investing in January 2000.