Charterhouse in $115m wireless exit

The New York-based mid-market firm has sold wireless network operator NewPath to Crown Castle after an initial investment just 15 months ago.

Charterhouse Group has sold wireless network operator NewPath Networks to Crown Castle, an owner of shared wireless infrastructures, for $115 million. 
The New York-based mid-market firm invested $20 million in NewPath from its Charterhouse Equity Partners IV Fund in April 2009, after which it invested additional growth capital in the company.

Charterhouse’s exit, just fifteen months after its initial investment, came as the result of strong investor interest in NewPath after the company experienced significant growth over a relatively short period of time.

What transpired was totally unexpected

David Hoffman

“What transpired was totally unexpected,” Charterhouse managing director David Hoffman told PEO. “We typically hold companies from four-to-seven year periods.”

Charterhouse’s strategy involves backing entrepreneurs with experience in sectors such as business and healthcare services. After investing $150 million in wireless tower company AAT Communications starting in 1997 alongside “serial Charterhouse entrepreneur” Bill Marraccini, the firm decided to once again invest with Marraccini in NewPath, which he co-founded in 2004.

“[Bill] came to us and said ‘I’d like to get institutional capital, and here’s this proprietary deal,” said Hoffman. 
Charterhouse Equity Partners IV is an open fund targeting $450 million. While Charterhouse does not have any other current investments in the wireless communications space, Hoffman said he expected the firm would “find something new to invest in” with Marraccinni on a proprietary basis in the next year or two.