High Street Launches $100M Fourth Fund

The Chicago buyout shop High Street Capital has begun meeting with investors to raise a $100 million fourth fund, which would be the firm’s largest vehicle ever. Its last fundraising effort took place about seven years ago.

Joe Katcha, a principal and co-founder, said the economic slump had slowed High Street’s fundraising efforts. “We were going to come to market about a year ago, a little more than a year ago, and the market just dried up,” Katcha told Buyouts. “That’s why the length of time appears so long.”

High Street Capital targets family-run companies located in the eastern United States in the business services, manufacturing, distribution and health care industries, typically with $10 million to $100 million in revenue and cash flows of $2 million to $8 million. It manages more than $120 million in committed capital. The firm’s latest fund, High Street Capital III LLC, closed with $80 million in 2003. Its first and second funds raised $20 million each in 1997 and 1999, respectively.

The firm has made 34 investments since its founding, eight of which are in its third fund, Katcha said. He said he anticipates holding a first close on the new vehicle by the end of the year and a final close in 18 months. Portfolio companies include Massey Fair, a food-ingredient distributor in Atlanta; BeneSys Inc. of Troy, Mich., a provider of health care payment processing services; and Bock & Clark of Akron, Ohio, which provides surveys and zoning reports for commercial real estate transactions.

Founded in 1997, High Street Capital has four principals, including co-founders Katcha and Kent C. Haeger, who worked together from 1993 to 1995 at S.G. Warburg, a British merchant banking firm. There Haeger was a managing director and ran the firm’s international equity derivatives business, while Katcha was a director who helped run operations and finance for the business.