Four professionals from
Gotham Private Equity, based in New York, plans to cut equity checks of $10 million to $50 million per investment in small and mid-sized companies. Sectors of interest include consumer products and services, energy services, financial services, industrial manufacturing, infrastructure services, restaurants and retail. The firm intends to pursue four types of deals: traditional leveraged buyouts, growth capital investments, roll-up plays, and acquisitions of family-owned businesses with no succession plan or that need capital to expand. Executives expect to close their first deal in the first or second quarter of 2010.
The core of the firm is comprised of Managing Principal David Benyaminy, a former director in the leveraged finance group at CIBC World Markets Corp. and credit analyst at JPMorganChase; Managing Principal Steven Flyer, a former M&A attorney at Dewey Ballantine LLP and an executive director in the leveraged finance group at CIBC World Markets Corp.; and Vice Principals Daniel Gaspar and Gregory Prata. Flyer told Buyouts that the team’s diverse background, particularly in leveraged finance, differentiates Gotham professionals from other lower mid-market investors because of their ability to assess risk and understand the capital markets. “We bring a lot of different disciplines,” he said.
The firm is supported by four wealthy families and an entrepreneur, and is looking to expand its network of wealthy investors to eight to 10. Each family, which has a right not to participate in any given deal, will typically take a board seat or gain observation rights for each deal it does support. “This gives them more involvement and more control over the allocation of their capital,” Flyer said of his supporters. “A lot of folks have funded capital commitments, but don’t have discretion over investments, and they wake up and find they’re in highly leveraged deals.”
The firm will charge a 1 percent to 2 percent management fee per deal, depending on size and situation, and will take 20 percent of the profits.
Gotham Private Equity professionals will not continue to manage investments made at Columbus Nova. The foursome joined Columbus Nova after leaving
peHub.com, a sister publication of Buyouts, first reported Gotham Private Equity’s launch.