Reverence Capital Partners Opportunities Fund V, the third in a series of financial services buyout pools, held a first close in September, a report issued by City of Hartford Municipal Employees’ Retirement Fund said. A final close is anticipated in early 2022.
While no hard-cap has been set for Fund V, it is expected to bring in no more than $2 billion, the report said.
Fund V’s predecessor wrapped up last year at a $1.2 billion hard-cap, ahead of a $750 million target. Reverence’s debut vehicle, also buyout-oriented, collected $421 million in 2016. Two other funds managed by the New York private equity firm are geared to credit investing.
Reverence was founded in 2013 by managing partner Milton Berlinski and partners Peter Aberg and Alex Chulack.
Berlinski worked for 26 years at Goldman Sachs, where he occupied several senior roles, among them founding member of the financial institutions group in investment banking. He led or executed more than 250 financial services deals, including many of Goldman Sachs’ own acquisitions.
Aberg also had a long tenure with Goldman Sachs, including as a managing director or partner focused on the bank, finance company and payments sectors. Chulack, another Goldman Sachs alumnus, was before Reverence a managing director at General Atlantic, where he led financial services investing.
Berlinski, Aberg and Chulack established Reverence to make PE and structured credit investments in the financial services sector.
The buyout strategy emphasizes control or significant minority investments in mid-market companies in five subsectors: asset/wealth management, capital markets, depositories and finance, financial technology/payments and insurance.
Reverence, which began with a fairly low profile, has recently been identified with headline-grabbing deals – among them one of the largest asset management transactions in a decade. Together with GTCR, the firm earlier in 2021 acquired Wells Fargo Asset Management, later rebranded as Allspring Global Investments, for $2.1 billion.
Apollo Global Management and Reverence also this year sold Diamond Resorts International, a timeshare operator, to Hilton Grand Vacations. The all-stock deal had an equity value of $1.4 billion.
Reverence’s other portfolio companies include financial advisory network Advisor Group, acquired in 2019 from Lightyear Capital and Public Sector Pension Investment Board; and life settlements manager Vida Capital, acquired the same year alongside RedBird Capital Partners.
Fund V will build a portfolio of 10 to 15 mostly North American companies in Reverence’s five subsectors, according to the City of Hartford MERF report. It will invest $50 million to $250 million in target opportunities with enterprise values of $300 million to $3 billion.
Fundraising will likely be helped along by performance. Fund V’s two prior buyout-oriented vehicles were as of June earning a combined net multiple of 2.1x and a combined net IRR of 31.5 percent, the report said.
Texas Municipal Retirement System recently disclosed a $100 million commitment to Fund V.
Reverence did not respond to a request for comment on this story.