Riverlake Expects To Hit $100M Mark

Riverlake Partners, a small-market buyout firm that regularly invites limited partners to co-invest, expects to hold a second close to bring its second fund near the $100 million mark by the end of the summer, a source familiar with the fundraising effort told Buyouts. The firm closed on $34 million for its debut fund in 2004.

Portland, Ore.-based Riverlake Partners’s target for the fund is $150 million, although our source said the firm would be comfortable operating with less than that. The firm reached its first close of $62 million toward the end of the first quarter. Placement agent E.L.K Capital Advisors is helping the firm raise the fund.

Investors in the second fund include the Oregon Investment Fund, a fund of funds capitalized by the Oregon Investment Council that invests in private equity and venture capital funds focused on Oregon.

Riverlake Partners has made seven investments via its first fund, and delivered one exit for investors. The firm said it made 4x its original investment when it sold Stock Equipment Company Inc., a Chagrin Falls, Ohio-based maker of industrial machinery for coal power plants, in June 2006 to Schenck Process of Germany. It owned the company for less than three years. Under the guidance of Chuck Grant, a Riverlake Partners general partner, the company saw revenues rise by 57 percent, to $66.3 million, according to the firm’s Web site.

Riverlake Partners invests $3 million to $8 million in companies with enterprise values of between $5 million and $50 million and revenue greater than $10 million. Sectors of interest include industrial manufacturing, consumer products manufacturing and service businesses.

Erik Krieger, a former investment banker at Paine Webber who in 1989 co-founded Pacific Crest Securities, a technology-focused investment bank, founded Riverlake Partners in 2002. The six-person investment team also include Victor Petroff, partner, a former president of the Precision Interconnect Division of Tyco International Ltd.; and Grant, partner, who since 2003 has also been CEO of SP Industries, a Riverlake Partners portfolio company that makes and markets specialty glassware and equipment for the biotechnology, pharmaceutical and other industries.