Tucker Spins Out FoF Group

Trading one famous Boston name for another, Tucker Anthony Private Equity Capital has been spun out into an independent firm. On the heels of the acquisition of the Boston-based regional broker by the Royal Bank of Canada (RBC), the $800 million fund-of-funds shop is expected formally to announce Wednesday that it has changed its name to Park Street Capital.

“When we started [in 1997], we had the understanding there might be a change in the future for Tucker Anthony,” says Bob Segel, managing director of Park Street. “We put the structure in place that we could become a private entity.”

After months of takeover speculation, RBC announced its intentions to acquire Tucker in August 2001. The two companies finalized the merger last month, but Segel says Park Street has been operating as an independent entity since the end of 2001.

“The separation was quite cordial,” he says. “It was our decision that we wanted to maintain our business model and our autonomy.”

Park Street will follow the same strategy it operated under as Tucker’s private equity group. Citing legal restrictions, Segel was hesitant to reveal the details of that strategy, but he would say that the fund-of-funds splits its allocation between domestic venture capital and buyout funds.

In a 1999 article published in Venture Capital Journal, a sister publication to Private Equity Week, Frazier & Co. named Park Street’s predecessor as an investor in its health-care funds, but Segel would not name any of the funds in which the firm invested.

“Clearly, we’re looking for managers that have a consistent track record over a period of time, that have a focused approach, that haven’t strayed from that focused approach and that haven’t had any significant management changes,” Segel says.

According to federal filings and data from Venture Economics, the firm has raised five funds ranging from $45 million to $300 million at the rate of about one per year.

Park Street’s limited partners include Heinz Foundation, State Teachers Retirement System of Ohio, Boston Foundation, Washington & Lee University and other unnamed endowments, foundations, public pensions, private pensions, family offices and individuals.

Most of Park Street’s investment professionals will be based in Boston, but their offices will not be located on the well-known street from which the firm took its name. In the new office, which will be located at 100 Federal Street, Segel joins directors Dorr Begnal, John Brooke and Kristine Dailey.

Brooke joined Park Street from Advent International, which was founded by his father and former Tucker employee Peter Brooke. Segel himself had been with Tucker since 1972 and is the son of Tucker’s former chairman Gerald Segel.

Additionally, Harry Turner, the former managing director and co-founder of Stanford University’s private equity program, will run Park Street’s Palo Alto, Calif. office.

“[I was attracted to Park Street by] the entrepreneurial opportunity to bring my experience to a highly professional set of experts,” says Turner, who joined the group in September. “The funds that they organize are truly structured to optimize a private equity investment program.”