Backer Of Fundless Sponsors Plots Fund IV

Firm: Tuckerman Capital

Fund: Tuckerman Capital IV LP

Target: $100 million

Placement Agent: None

Tuckerman Capital, a private equity firm with an unusual strategy of investing only in fundless sponsors, is in the early stages of planning its fourth fund, co-founder Timothy Briglin told Buyouts.

Starting sometime early next year, the Hanover, N.H.-based firm will likely seek $100 million for the fund, Tuckerman Capital IV LP. That’s roughly the same amount the firm raised for its previous fund, which still has around $25 million of dry powder. The firm does not expect to hire a placement agent, Briglin said.

Tuckerman Capital backs small firms or teams that want to buy companies but don’t have conventional funds to do it with. It’s a one-stop shop of sorts for these so-called fundless sponsors, as it provides both the debt and equity for investments. It typically backs deals with enterprise values ranging between $8 million and $30 million.

Briglin said the strategy gives Tuckerman Capital some downside protection if a company struggles, plus current returns by way of debt payments from the target company.”All the capital is from Tuckerman,” Briglin said. “That’s very unique in the private equity world.”

Hanover Partners Inc., a fundless sponsor that Tuckerman backs, recently sold Solidscape Inc., a manufacturer of three-dimensional printers, to Stratasys, a publicly traded company that specializes in developing and marketing 3-D printing systems. Merrimack, N.H.-based Hanover Partners generated a 2.5x cash-on-cash return on the deal over a five-year investment period, according to the firm.

Other fundless sponsors Tuckerman Capital has backed include Equis Capital Partners of Hoboken, N.J.; Pegasus Capital Group of Santa Monica, Calif.; and 2SV Capital LLC of Boston.

Briglin and Peter Milliken, both former partners with the buyout firm Green Mountain Partners, founded the firm in 2001. Briglin has experience in investment banking and politics, working for a time as a legislative assistant to Sen. Patrick Leahy of Vermont on economic, tax and banking issues. Milliken, before joining Green Mountain, was an investment manager for Asian Strategic Investments Corp., a China-based private equity fund.