Littlejohn Gets A Little Bigger –

Littlejohn & Co. LLC has hopped in the fundraising pool and is swimming gracefully. The Greenwich, Conn.-based private equity firm recently held a first close on its third buyout fund after about four months in the market. Littlejohn Fund III LP has garnished with $380 million in limited partner commitments, surpassing the firm’s inaugural fund, which took in a total of $205 million from eight investors.

But even with jubilant LP interest, by design, the new fund will not tower over its $530 million predecessor, Littlejohn Fund II LP, which held its final close in 2000. Fund III is targeted to raise $600 million and has a hard cap of $650 million, leaving little wiggle room for any late-coming limited partners. The minimum investment has been set as $20 million, but the firm is willing to take less from “desirable LPs,” Angus Littlejohn, chairman and CEO of Littlejohn, told Buyouts.

The modest increase in the new fund’s size ensures that Littlejohn’s investment approach of acquiring control positions in underperforming middle-market companies will not change. “We have a very specific mission statement and a very sensitive investment time-frame-we make about two to three investments a year-so unless we planned on changing everything around, we’re not going to try to raise a billion-dollar fund,” Littlejohn said.

Littlejohn kicked off the fundraising effort in late August 2004 and did not enlist the help of a placement agent, as it did with Fund II. “Based upon the level of activity we have going now, I would hope we will reach our cap of $650 million by March,” Littlejohn said.

Littlejohn declined to name limited partners in Fund III, but did say that they include state and corporate pension funds, endowments, domestic and foreign insurance companies and fund-of-funds. Altogether, approximately 80% of Fund III’s limited partners are institutional investors, while the remainder is made up of families and individuals, he added.

Previous investors in Littlejohn funds include BancBoston Investments Inc., Duke Management Co., Howard Hughes Medical Institute, Johnson & Johnson, Kansas Public Employees Retirement System, Oregon State Treasury and Teachers Insurance and Annuity Association of America, according to Thomson Venture Economics.

Founded in 1996, Littlejohn invests in the core markets of the LBO industry including automotive and transportation parts and equipment, chemicals, consumer products, food processing, healthcare, industrial equipment, plastics, and textiles.

Among the firm’s recent investments is the December 2004 add-on acquisition of the aeronautics business of General Dynamics by its portfolio company Wyle Laboratories. In July 2004, Littlejohn sold Jerr-Dan, a manufacturer and marketer of towing and recovery equipment, to Oshkosh Truck Corporation for $80 million in cash.