NY shop raises $527M for fund V

Wellspring Capital Management has raised $527 million for its fifth fund, according to a source familiar with the fund-raising effort.

The target for Wellspring Capital Partners V is $1.3 billion.

Credit Suisse is helping the firm raise the fund, which executives at Wellspring Capital hope to close by June 30.

Wellspring Capital’s fourth fund closed in 2005 with $1 billion in commitments.

The New York-based buyout shop typically invests between $75 million to $150 million in North American companies with enterprise values of at least $75 million, though it can target deals as high as $2 billion. Although the firm invests in numerous sectors, it avoids technology, telecommunications, real estate and commodity-based businesses.

Wellspring Capital’s most recent deal came in September, when it sold Vatterott Education Centers Inc., a St. Louis, Mo.-based postsecondary trade school, to TA Associates. The firm scored a good return on the deal, having already recouped its $40 million investment in the company with a refinancing in May, as previously reported in Buyouts (a PE Week affiliate publication).

Managing Partner Greg Feldman, the former head of acquisitions at EXOR America Inc., the U.S. investment arm of the Italian corporation Agnelli Group, co-founded Wellspring Capital in 1995.

Other managing partners include William Dawson, an alum of Donaldson Lufkin & Jenrette, who, prior to joining Wellspring Capital in 2001, was the head of Whitney & Co., a mid-market buyout shop; David Mariano, a former managing director in the restructuring group at The Blackstone Group; and Carl Stanton, a former principal at mid-market investment firm Dimeling Schreiber & Park.

In all, the firm has 20 investment professionals. —Bernard Vaughan