The Toronto-based buyout shop is targeting about $318 million for Imperial Capital Acquisition Fund IV, and the firm may still manage to reach its goal. There is a “strong possibility” of another $45 million in commitments from institutional investors and another $45 million from wealthy individuals, the source said
In addition, the source said that there are up to seven wealthy family trusts that may invest as much as $23 million each. The firm raised about $100 million for its third fund, which closed in 2003, according to Thomson Reuters (publisher of PE Week).
Imperial Capital changed course as to which limited partners it targeted midway through its fund-raising effort after experiencing the impact of the financial crisis first-hand, the source said. The shop started raising the fund in March 2008 and had a book of $182 million in likely commitments from U.S.-based institutions that collapsed to about $45 million when the financial crisis deepened later in the year. Once that happened, Imperial Capital, which did not employ a placement agent to help raise the fund, changed its focus to wealthy individuals and families.
LPs include Bank of Montreal, Canadian Imperial Bank of Commerce, Kensington Capital Partners and Nesbitt Burns. About 100 wealthy individuals have also committed to the fund.
Imperial Capital was founded in 1989 by Managing Partner Stephen Lister, a former president of Startups Inc., a company he set up to provide equity financing and consulting assistance to early stage companies.
Imperial Capital invests in non-cyclical consumer products businesses, such as food, skin care and cosmetics and non-cyclical business services, such as warehouses and engineering consultants. Typical equity checks are between $20 million and $50 million.
Imperial Capital has already invested from fund IV, having bought Schulman Associates, a Cincinnati, Ohio-based company that provides pharmaceutical medical trial services. —Bernard Vaughan