On the heels of closing its second mezzanine fund, Minneapolis-based Norwest Equity Partners put the finishing touches on its eighth private equity vehicle, Norwest Equity Partners VIII, L.P. The terms of the fund were not disclosed.
At $800 million, the fund mirrors its predecessor’s size, and like previous Norwest vehicles, the fund is completely subsidized by Norwest’s sole limited partner, Wells Fargo. “It’s a relationship that has gone on a long time, and we view having them as our sole LP as a competitive advantage,” Norwest Managing General Partner Timothy DeVries said. “It gives us access to the Wells Fargo network and provides a flexible charter, and it also helps that our fundraising process does not take the resources most firms need these days in order to raise funds.”
True to the firm’s past mandates, this fund will look to invest between $20 million and $80 million in management buyouts, industry consolidations, recaps and growth financings. Norwest targets companies with enterprise values ranging from $50 million to $250 million, and has a sector focus spanning the manufacturing, distribution, healthcare, business services and consumer products industries.
“Our focus hasn’t changed,” DeVries said. “We like good companies and we like to grow those businesses to become better companies. That’s the way we operate. We have access to a lot of proprietary deal flow, and through Wells Fargo, have access to a number of resources that can help our companies grow once we join as investors.”
The raising of NEP Fund VIII comes amid a dynamic stretch for the firm, which has been marked by activity in all facets of its market. Most recently, Norwest closed a deal to acquire Becker Underwood, a specialty chemical company, from Century Park Capital Partners (see story, page 18), and earlier this year the firm completed investments in third-party logistics provider Jacobson Companies and rubber products manufacturer Longwood Industries. Additionally, the firm has seen a number of realizations in the past 12 months, including the June IPO of Life Time Fitness, which raised $210 million. In May, Norwest also closed its second mezzanine investment vehicle, Norwest Mezzanine Partners II, LP, at $400 million.
Firm: Norwest Equity Partners
Fund: Norwest Equity Partners VIII, L.P.
Capital Raised: $800M
Limited Partner(s): Wells Fargo