Smaller Hit the Market

It’s difficult to miss the mega-funds that are in the market. After all, buyout funds with targets exceeding $5 billion rarely escape anyone’s radar. However, there are a few funds in the market that may have slipped by unnoticed because they are a little smaller.

* Sea Change Management went to market this year with its inaugural Sea Change Investment Fund, LLC. The San Francisco-based firm introduced the Sea Change Fund to provide capital designed to help stimulate growth to the North American sustainable seafood market.

The fund not only aims to provide a financial return for investors, but it also will pursue a conservation-related initiative, as well, says Sea Change Managing Principal Jason Winship.

The fund hit its $20 million target in the second quarter.

* Caris Ltd. was formed by David Halbert, the former chairman and CEO of AdvancePCS, a health improvement company founded by Halbert in the late 1980s. He launched Caris to make strategic investments of between $10 million and $100 million in private and public service industry-oriented companies (such as health care, energy and financial services). Ex-AdvancePCS execs Laurie Johansen and Leslie Simmons Brille joined Halbert at his new firm.

Caris recently completed its first recapitalization, acquiring control of Pathology Partners through the $120 million recap.

* Guggenheim Aviation Investment Fund LP, the aircraft investment fund run by Guggenheim Capital could have the narrowest niche in private equity. The fund is used exclusively to buy commercial aviation assets.

“We’ve really had some fundamental changes to our market, with the decline in air travel after Sept. 11, the rise of low-cost carriers and having just two manufacturers instead of three,” says Guggenheim CEO Steven Rimmer. “The liquidity has been sucked out of the market, and we think that this type of fund can offer good upside with low risk.”

If one were to look at the annals of aviation, the latest Guggenheim fund could probably be classified as a descendent of an earlier fund, the 1926-vintage Daniel Guggenheim Fund for the Promotion of Aeronautics. The goals of that fund were related to the promotion of aeronautical education and research, the development of commercial aircraft and aircraft equipment and the application of aircraft to a variety of economic and social activities.

This story originally appear in Buyouts, a related publication.