Chicago Shop Holds First Close On Fund IV

Firm: High Street Capital

Fund: High Street Capital IV LP

Target: $100 million

Placement Agent: Ariane Capital Partners

High Street Capital has raised $17 million so far on its quest to raise $100 million for its fourth buyout fund.

The Chicago-based firm began raising the fund around May of last year, Joe Katcha, a principal with the Chicago-based boutique, told Buyouts. Katcha and his partners hope to finish raising the fund by the end of the year.

Ariane Capital Partners LLC, a Villanova, Pa.-based placement agent, is helping High Street raise the fund.

The first close came from wealthy individuals who have committed to previous High Street funds only, Katcha said. On average, those investors committed 30 percent more than they did to previous funds, he added.

High Street, founded in 1997, will continue to plug around $5 million to $15 million in companies that generate around $10 million to $100 million in annual revenue. The firm typically invests in companies in the central United States, or, as Katcha described the firm’s target geography, “anywhere we can get to and back in a day.”

The firm limits its geographic reach because of its size and operational focus. High Street has two investment professionals and two former business owners and executives who act as operating partners. The firm has two other junior investment professionals as well.

Sectors of interest to High Street include outsourced business services, health care services, distribution and niche manufacturing. Its portfolio includes DataSource, a Kansas City, Mo.-based provider of back office services to restaurant chains, auto dealerships and other multi-location businesses the firm bought in March 2007; Superior Fibers LLC, a Bremen, Ohio-based producer of long-strand glass fibers for filtration and composite products in which the firm invested in 2006; and DiversiTech, an Atlanta-based manufacturer of air conditioning condenser pads and a distributor of heating, ventilating, air conditioning and refrigeration products in which the firm invested in 2005.

In December, High Street scored a healthy exit, which could help it attract more investors. The firm sold Countrywide Hospice Care Inc., an Anniston, Ala.-based provider of in-home hospice services it bought in 2005, generating 3.1x its investment, Katcha said.