Pittsburgh Firm Shopping For Placement Agents

PNC Equity Partners is looking for a placement agent to help prep its third fund, a source with knowledge of the firm’s plans told Buyouts.

The firm is in the earliest stages of planning the fund, which its executives expect to bring to the fundraising market in the fourth quarter of 2010 or first quarter of 2011, our source said.

The Pittsburgh, Pa.-based shop closed its last fund, PNC Equity Partners II LP, in August 2007 at $272 million. While it did not hire a placement agent its last time around, our source said the firm is considering using one for Fund III in hopes it will be able to expand its base of limited partners. Executives at the firm have not decided on a target for the new fund but expect it to be larger than Fund II.

Fund II is about 40 percent invested following the firm’s most recent investment, the May 8 acquisition of APEX Analytics Inc., a Greensboro, N.C.-based provider of recovery audit services. Prior to that deal, PNC Equity’s last platform investment was in September 2008 when it bought The Orthotic Group, a Markham, Ontario-based company that makes sandals, athletic footwear and heel lifts.

The firm is the private equity affiliate of PNC Financial Services Group. Its typical equity investments run between $10 million to $30 million for targets with enterprise values ranging from $25 million to $125 million.

PNC Equity has 12 investment professionals led by David Hillman, the president and partner who joined the affiliated bank in 1976 and helped found the private equity group in 1982.

Executives at the firm declined to comment.