Audax Pushes Back Launch Of Next Buyout Fund

Firm: Audax Group

Fund: Audax Private Equity Fund IV LP

Target: $1 billion

Fund: Audax Mezzanine Fund II

Target: $750 million

Audax Group is opting to wait until at least the fourth quarter to begin raising its fourth buyout fund, Buyouts has learned.

According to Co-CEO Geoff Rehnert, the Boston-based shop made the decision because it hasn’t deployed enough of its current fund, Audax Private Equity Fund III LP, to justify raising another. Even after doing ten add-on transactions this year, Fund III is only around 50 percent deployed. That means the firm is sitting on around $500 million of the $1 billion pool, which closed in 2007.

Rehnert wrote in an email: “Last fall, we anticipated we would be further along investing Fund III at this point in time, but our investment pace has slowed as credit tightened and deal activity has slowed.” The fourth fund is expected to have a similar target to its predecessor.

Rehnert said Audax anticipates it will have deployed at least 75 percent of Fund III by the fourth quarter, a level more in line with re-entering the fundraising market.

Audax’s mezzanine practice, on the other hand, is going full speed ahead. Audax Mezzanine Fund II has deployed more than 70 percent of its $700 million in capital and the firm is currently in the market for a third fund with a $750 million target. Audax anticipates a close on the vehicle in the fourth quarter.

Audax also has a senior loan fund which has been investing since 2007. The vehicle isn’t open for new investors but “may reopen at a later date,” Rehnert said.

Audax’s first buyout fund, Audax Private Equity Fund I, a 2000 vintage, has posted a return of 1.6x its money with a 13.9 percent IRR, according to data from the California Pension Employees’ Retirement System.