Excellere Closes Second Fund At $465 Million

Firm: Excellere Partners

Fund: Excellere Fund II

Amount Raised: $465 million

Placement Agent: UBS Investment Bank

Denver-based Excellere Partners is ready to start rolling out its sophomore fund.

The growth oriented buyout shop announced last month that it had closed Excellere Fund II at $465 million. David Kessenich, a managing partner, described it as a “one and done” fundraise with a single close. It was heavily oversubscribed, he said. “We only sent out a few books to new potential investors.”

Excellere Partners promotes a buy-and-build investment strategy, focusing on mid-market companies with revenues ranging from $20 million to $150 million. The firm’s typical equity check is $40 million, Kessenich said.

“We believe in partnering with entrepreneurs and management teams,” he said. “We pursue a buy and build strategy.”

Excellere Partners frequently buys into its portfolio companies by recapitalizing an existing business and working with its management team on a roadmap for future growth, he said. About half the current fund is invested in health care companies, he said. The firm also invests in government services providers, business services, education and training companies and specialty food producers.

Its portfolio includes AlexaCare Health Solutions, ASI Government, Medtech College/Institute, MTS Medication Technologies, Personable Insurance and U.S. Water Services.

The firm was founded in 2006 by Kessenich, Rob Martin and Ryan Heckman as a spinout of KRG Capital Partners, another mid-market buyout shop in Denver that is now investing out of its Fund IV. The three men all are managing partners at Excellere Partners, which lists nine investment professionals of vice president or higher on its Web site.

Members of the firm made a commitment of $13.2 million to Excellere’s $265 million inaugural Fund I, which closed in February 2007, and $15 million to Fund II, Kessenich said.

Known LP investors include Key Capital Corporation, the Los Angeles County Employees Retirement Association and SL Capital Partners, according to the Thomson One private equity database.

Although the firm announced the fund’s closing on Dec. 7, the firm actually closed the fund almost a year earlier, on Dec. 15, 2010, Kessenich said. “We were able to park it until we were finished investing Fund I.”

UBS Investment Bank helped the firm raise Fund II as it did on Fund I, he said.