The firm’s first investment from the fund came Sept. 22 with the platform acquisition of In-Place Machining Co., a Milwaukee-based machining and cutting business.
Terms of the transaction were not disclosed.
Private equity firms typically make platform investments in businesses, after
which tuck-on additions follow to give the business scale.
The new fund is more than double the size of Levine Leichtman’s previous lower middle-market fund, which closed in 2016 with total capital commitments of $615 million. That fund has acquired eight companies and exited from two.
The new fund, called the LLCP Lower Middle Market Fund III, or LMM III, will invest primarily in lower middle-market companies with less than $50 million in revenue in the United States.
Managing partners Michael Weinberg and Matthew Frankel took over active leadership in Levine Leichtman last year when a succession plan for the firm’s senior team was formalized.
In late 2018, the firm closed Levine Leichtman Capital Partners Fund VI, a $2.5 billion flagship fund. A previous flagship, Levine Leichtman Capital Partners V, had $1.65 billion in capital commitments that were used to buy 11 portfolio companies.
Founded in 1984, Levine Leichtman has $9 billion in assets under management and offices in Los Angeles; New York; Chicago; Charlotte, N.C.; Miami; London; Stockholm; and The Hague, Netherlands. Levine Leichtman, which has 30 active investments in its portfolio, has been an active buyer and seller this year.
Earlier this month, Levine Leichtman portfolio company Monte Nido & Affiliates, which operates residential and intensive outpatient eating disorder treatment programs, completed its acquisition of Waltham, Mass.-based Walden Behavioral Care.
With the addition of Walden to its portfolio, the private equity firm seems to have reversed a trend of selling businesses.
Since March, Levine Leichtman has acquired Hopkins Bruce Publishers Corp., Creditinfo Group and CE Resource Inc., and invested in Prime Global Medical Communications Ltd.
The private equity firm sold seven businesses this past year, including its ownership stake in Dallas-based environmental consulting firm Trinity Consultants Inc., Nothing Bundt Cakes, ZorgDomein, Jonathan Engineered Solutions, Futurewhiz, Pacific Handy Cutter Inc. and FlexXray Holdings.
