Eos Partners completes broad fund restructuring, raises bridge fund

  • HarbourVest led restructuring of two funds
  • Firm raised bridge fund for new investments
  • Process involved two older funds

Eos Partners completed a broad restructuring process that transferred assets from its third and fourth funds into a new vehicle that gives the firm at least five more years to sell the investments, sources told Buyouts.

The deal also involved creating a $75 million bridge fund, providing the firm capital to invest prior to raising its fifth fund, a source said.

HarbourVest led the deal as the buyer of existing LP interests and contributed to the bridge fund. The bridge fund also attracted other investors, a source said.

The deal, which involved transferring 10 to 12 assets into the new vehicle, included about 50 percent of LPs in the two funds selling their stakes, the source said. The other half of the LP base chose to roll their interests into the new vehicle, the source said.

Evercore was secondary adviser on the deal, which was in market since last year and closed in Q1, sources said.

No one from Eos responded to several requests for comment.

Steven Friedman and Brian Young, formerly of Odyssey Partners, launched Eos in 1994. Eos’s PE group focuses on lower-middle-market companies in business services, consumer, healthcare, technology services, distribution, specialty manufacturing and energy.

Eos closed Fund III on $252.5 million in 2004 and Fund IV on $600 million in 2007. Fund III was generating a 9 percent net internal rate of return and a 1.8x multiple as of March 31, 2018, performance information from California Public Employees’ Retirement System shows.

Fund IV was producing an 11.8 percent net IRR and a 1.7x multiple, as of that date, CalPERS data shows.

In October, Eos recapitalized LEGACY Supply Chain Services.

Action Item: Check out Eos’s Form ADV here: https://bit.ly/2CHL2X1