Three long-time senior executives are expected to leave Hellman & Friedman over the coming months as the firm embarks on an unprecedented fundraising pace, raising its next flagship after closing its prior mega-pool in July 2021.
The three departing partners are: Philip Sternheimer, who leads value creation in Europe; Adam Durrett, who focuses on financial services and healthcare; and Erik Ragatz, who has led the firm’s focus on consumer, retail and industrials. The three are expected to leave over the next year, according to a person with knowledge of the firm.
While partner departures are generally viewed with concern by LPs, in this case, the departures were anticipated as the partners invested out the last fund, the person said.
The departures will allow a changing of the guard, another source said. “They keep making room for the next generation of stars,” the source said.
Buyouts understands Ragatz is essentially retiring and will stay on in an advisory role, according to a limited partner with knowledge of the firm.
Ragatz joined Hellman & Friedman in 2001 He is chairman of the board of Grocery Outlet Holding and Snap One Holdings, as well as lead director of Caliber Collision and At Home Group. Before Hellman & Friedman, he worked at Bain & Co.
Sternheimer joined the firm in 2007, according to his bio on Hellman & Friedman’s website. Before, he worked at BC Partners and at Bain & Co. Durrett joined in 2005, prior to which he worked in media and telecom M&A at Morgan Stanley, his bio said.
Hellman has been talking to LPs about its eleventh fund after closing the tenth fund in July 2021 on $24.4 billion. Sources said Fund XI could target up to $30 billion. The expectation is several of the firm’s existing backers will have to wait until 2023 to commit to the pool, as their allocations for the year are tapped, the source said.
Fund X was approaching 60 percent deployed and/or reserved, which put Hellman on track to launch the new fund later this year, a source with knowledge of the firm told Buyouts in a previous interview.
That kind of furious investment pace is likely slowing in the uncertain, volatile markets. Anecdotally, LPs have said they are seeing fewer distributions from their existing portfolios, which leaves them with less capital to deploy back into re-ups or new relationships.