After Run of Exits, Sentinel Jumps Back Into Fundraising –

It’s clearly a seller’s market these days, and few have benefited from this more so than Sentinel Partners.

The New York-based buyout shop has unloaded four companies from its portfolio in the past year. Sentinel most recently chalked up a 5x equity return through the initial public offering of Spinrite as a Canadian income trust, but prior to that the firm completed sales of Floral Plant Growers, Cottman Transmission Holdings and Castle Dental.

Now, after having greased the skids with an outpouring of limited partner distributions, Sentinel has unveiled its largest fund to date, the $300 million Sentinel Capital Partners III, LP. The new fund has already closed on more than $160 million in commitments, according to Form D filings submitted to the Securities and Exchange Commission. No limited partners were mentioned in the filing, although investors in earlier Sentinel vehicles include Kemper Insurance Co., Massachusetts Mutual Life Insurance Co., Prudential Insurance Co., HSBC Securities, PNC Equity Management Corp., Provident Bancorp, The Mayo Foundation and Bear, Stearns & Co., among others.

Sentinel has identified $5 million as the minimum investment for the new fund, but the firm will accept smaller sums in certain circumstances. The filing did not mention if a placement agent had been hired to market the fund.

Even if the $300 million target is still two digits shy from the colossal fundraising objectives some funds unveiled recently, for Sentinel, the new fund represents a sizeable jump from earlier vehicles. The new fund will more than double its predecessor, the $126 million Sentinel Capital Partners II, LP, and is about six times larger than Sentinel’s inaugural fund, a 1996-vintage vehicle.

Sentinel was originally formed when David Lobel and John McCormack launched the firm after their previous employer, First Century Partners, disbanded. Sentinel has since added Eric Bommer as partner and James Coady and Paul Murphy as principals, while First Century Co-Founder Michael Myers and Wesray Capital Veteran Frank Richardson sit as senior advisory partners at the firm.

On its Web site, Sentinel identifies it will invest as much as $25 million of equity per investment in companies with operating profits that range from $3 million to $20 million in size. The firm targets the business services, consumer products, food and restaurant, franchising and light manufacturing sectors and will make its investments through management buyouts, corporate divestitures, going private or corporate growth transactions.

Other investments still in Sentinel’s portfolio include golf cart replacement-parts manufacturer Nivel, Tony Roma’s franchisor Roma Restaurant Holdings and Alemite, a maker of industrial lubrication equipment.

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