- Friday August 20, 1999
Peninsula Capital Partners L.L.C. (Detroit, Michigan) — The principals of Peninsula Capital Partners are pleased to announce the final closing of Peninsula Fund II, a private investment partnership with $143.3 million of committed capital, a figure well in excess of the Fund II’s original $100 million target. Fund II focuses on providing hard-to-find subordinated debt, equity and late-stage venture capital to smaller middle-market companies requiring capital to fund growth, acquisitions or changes in ownership. Limited Partners include state and corporate pension funds, commercial lenders, insurance companies, major corporations and high-net-worth individuals.
Peninsula Fund II is the successor partnership to The peninsula Fund, a similarly-focused $53 million partnership closed in 1996 that is now fully invested. Peninsula Fund II will expand upon the investment program of its predecessor by frequently investing at more than one level of a company’s capital structure and by participating at various stages of a company’s development. Such flexibility is rare in today’s capital marketplace and results in Fund II playing different roles from one transaction to the next.
A sample of this flexibility can be seen in Find II’s early investments. Fund II has already invested over $35 million in five companies, providing capital for such diverse purposes as supporting a management buyout, funding product development, buying out a retiring majority shareholder, backing an industry consolidation effort and completing an acquisition. In three of these investments, Fund II provided a strip of subordinated debt in the company and in the two other investments, Fund II invested a combination of subordinated debt, preferred stock and common stock.
“Our investment approach defies traditional categorizations such as mezzanine, buyout or venture capital”, states Scott Reilly, the General Partner’s President and co-founder, “We see ourselves as a ‘utility infielder’ within the private equity industry as we will provide traditional subordinated debt in one transaction and then act as an equity co-sponsor in the next. We are very flexible regarding investment structure; however, we are strictly a minority-interest investor.”
“Our priority is to be responsive to the demands of our transaction partners”, Mr. Reilly concluded, “We will consider filling different roles from one transaction to the next so long as we are being adequately compensated for the investment risk we are assuming.”
Fund raising for Peninsula Fund II was launched in late April 1998 and quickly garnered commitments exceeding Fund I’d capital base. Fund II’s first closing was held on October 1st, 1998 on $78 million. A second closing on an additional $50 million was held on March 31st, 1999 which brought the Fund’s capitalization to $128 million. The final closing was on August 6th which added another $15 million and topped the Fund out at slightly more than $143 million.
The General Partner of both Funds is Peninsula Capital Partners L.L.C., a Detroit-based investment management company founded in 1995 by William Y. Campbell, Scott A. Reilly and William F. McKinley. Messrs. Campbell and McKinley previously founded in 1988 W.Y. Campbell & Company, a respected investment banking organization providing M&A and other corporate finance advisory services to a broad range of middle-market and Fortune 500 clients, which was acquired by Comerica Bank in 1995. Mr. Reilly previously participated in the successful development of two other private capital management companies, Churchill Capital, Inc. and Northstar Capital, Ltd., both based in Minneapolis. The balance of Peninsula Capital’s professional team is comprised of Karl E. LaPeer and Steven S. Beckett (Senior Vice Presidents and Principals), Jon Krempel, Hector Bultynck and Christian Moye (Vice Presidents).
With the final closing of Peninsula Fund II, Peninsula Capital Partners now manages nearly $200 million between its two partnerships, making it one of the largest fund managers of its type in the State of Michigan along with such notable organizations as Questor Partners and Windpoint Partners.
For additional information please call Scott A. Reilly at (313) 237-5100.