Houston, Texas-based private equity firm The CapStreet Group has held a first close on $80 million for its third fund, which is targeting $200 million.
CapStreet has been fundraising without the use of a placement agent for roughly a year and was originally targeting $300 million for the fund, chief financial officer Katherine Kohlmeyer told PEO.
The target is a substantial decrease from the size of its predecessor fund, which closed on $371 million in 2000. Fund II invested in 15 platform businesses and made more than 50 add-on investments.
Fund III will continue the firm’s focus on control investments in family-owned, lower mid-market companies based in Texas and other states in the southern US. CapStreet’s sector focuses include manufacturing and distribution, business services, infrastructure and energy-related products and services.
The firm’s pace of investment is approximately two to three transactions per year, Kohlmeyer said.
CapStreet’s limited partners include corporate pension funds, life insurance companies, endowments, financial institutions and family offices, the firm said in a statement. Fund II counted AT&T Investment Management and New York Life Insurance among its LPs, according to PEO’s sister data site Private Equity Connect.
The majority of the $80 million raised was from LPs in previous funds, Kohlmeyer said.
The fund has made two platform investments to date. CapStreet led the recapitalisation of structural fabrication services company Trinity Steel Holdings in July and earlier invested in industrial gaskets distributer GHX Holdings.