Pegasus Nearing Close On $750M Fund

Pegasus Capital Advisors, a special situations investor backing companies that LBO firms avoid, is on the cusp of holding a penultimate close on its $750 million-targeted fourth fund, said a source close to the firm. Expect the tally to be close to $750 million, and for a final close to come in above target at the end of this month.

Founded in 1995, the Cos Cob, Conn.-based firm manages some $1.5 billion, and has made more than 65 mid-market investments. The firm has 50 investment professionals and offices in both Connecticut and New York. An executive there declined comment.

Leverage isn’t the main component of the strategy at Pegasus Capital Advisors, said the person close to the firm, while the firm describes itself as a special situations “value buyer and business builder.” It often buys companies in sticky situations, not ripe for traditional LBO structures, then usually provides them with between $20 million and $75 million in capital as either debt or equity.

The firm has already completed three deals out of the fourth fund. The three companies are LED Effects, a provider of LED lighting design; Profiles In Concrete, an architectural cast stone producer; and Sensibuilt Building Solutions, a maker of cellular PVC building products.

The two managing partners are Craig Cogut and Rodney Cohen, both former lawyers. Previously, Cogut was a founding partner of Apollo Advisors, where he worked on distressed securities and restructuring deals. Cohen was a consultant to MarketlinkGroup, and before that a corporate development officer at a mid-sized company.

The placement agent for the fund is Park Hill Group. The firm’s third fund, with $316 million in commitments, closed in 2004.—M.C.