PE fund briefs, week of March 17, 2008

Muller & Monroe seeks $300M

Funds-of-funds manager Muller & Monroe Asset Management is back in the market with its second vehicle aimed at backing emerging managers. The Chicago-based firm invests primarily in private equity funds managed by minorities and women that are based in the Midwest. It is unclear if the firm will expand its geographic footprint with the new fund.

Muller & Monroe is seeking $300 million for its sophomore vehicle, M2 Private Equity Fund-of-Funds, which is more than double the haul from its first fund, a $144 million vehicle raised in 2005.

For its inaugural fund, the firm raised the majority of its capital from LPs in and around the Windy City, including the Chicago Policemen’s Annuity & Benefits, Chicago Transit Authority Employees’ Retirement Plan, Public School Teachers’ Pension and Retirement Fund of Chicago, Illinois Municipal Retirement Fund and State Universities Retirement System of Illinois. From outside Illinois, the New Mexico State Investment Council also backed the first fund.

Muller & Monroe is helmed by President Andre Rice, who founded the firm in 1999. —Joshua Payne

Lincolnshire tests the waters for new fund

Mid-market buyout firm Lincolnshire Management Inc. has been gauging limited partners’ interest in committing to a new fund. The New York-based firm will likely hit the market this spring with its fourth vehicle, Lincolnshire Equity Fund IV, which is rumored to have a target of about $700 million.

The firm’s prior fund, Lincolnshire Equity Fund III, closed in 2005 with $433 million in commitments. Limited partners included New York City Retirement Systems, Ohio Public Employees Retirement System and SVG Capital.

Lincolnshire Management declined to comment on the fund, but a source familiar with the effort says that LPs have responded positively, particularly European investors who are looking to gain access to U.S. mid-market funds.

Lincolnshire Management specializes in acquiring middle-market companies and helping them grow through equity investments. Rather than install a slate of new leaders, the firm prefers to work with a portfolio company’s existing management team and often gives them an equity stake in the company.

“We’re a value house and have bought very little in the last three years,” Lincolnshire Management President T.J. Maloney said at the 20th annual Buyouts East conference in New York earlier this month.

The buyout firm has lodged some exits recently. Last fall, Lincolnshire Management sold Excelsior Radio Networks Inc. to Triton Media Group, a digital products and services supplier, in a deal that was reportedly valued at more than $100 million. Lincolnshire remains a minority stakeholder in the company. Last summer, the firm sold port operator AMPORTS to AIG Highstar Capital for $425 million. —Joshua Payne

Carlyle eyes $1B mezz fund

The Carlyle Group is raising up to $1 billion for its second mezzanine fund, according to a regulatory filing. It has already secured nearly $210 million in commitments. The firm raised about $436 million for its debut mezzanine fund in 2005.

Russian buyout firm nabs $660M

Renaissance Partners, an affiliate of Moscow-based investment bank Renaissance Capital, has raised $660 million for its inaugural private equity fund. It will focus on buyouts of Russian companies.

Candover aims for $7.8B

Candover Investments, a London-based private equity firm focused on the European market, is raising $7.8 billion for its latest fund, according to a regulatory filing. The firm’s prior fund closed in November 2005 with about $5.5 billion. It so far has made nine investments from the new fund.

About 45% of that fund’s limited partners were U.S.-based while 25% was from the United Kingdom and another 24% came from other European nations.

SFW closes its debut fund

SFW Capital Partners, a Rye, N.Y.-based middle-market private equity firm, has closed its debut fund with $300 million in capital commitments. The firm was founded by former AEA Investors pros Thomas Salice, Roger Freeman and Norm Wells in addition to Casey Lynch (from Parthenon Capital) and David Webb (from Merrill Lynch’s financial sponsors group).