Five ex-Brazos execs close debut fund on $420m

The oversubscribed fund, raised by alumni from Brazos Private Equity Partners, reflects the importance of a track record and team experience when raising a debut private equity fund.

Five former Brazos Private Equity Partners executives have announced the final close of their debut fund, CenterOak Equity Fund I, at $420 million, well over the initial target of $350 million.

The debut fund, which was launched last May, has now met its hard-cap. It will focus on US-based mid-market companies operating in three core areas: industrial growth, consumer, and business services. Its investors include Oklahoma Police Pension and Retirement System, which committed $7.5 million to the fund, and Caledonia Investments, according to PEI data. 

Dallas-based CenterOak Partners was launched in September 2014 by Randall Fojtasek, former co-founder and co-chief executive officer at Brazos, who leads the firm with one partner from Brazos, Michael Salim and three senior Brazos executives, Lucas Cutler, Jason Sutherland, and William Henry. The five have worked together for nearly 15 years, CenterOak said in a statement. Fojtasek set up CenterOak after the firm decided not to raise a fourth fund. 

It is not clear why Brazos chose not to raise a fourth fund. In March 2014, media firm PE Hub quoted Michael Salim, saying that when considering whether to raise another fund, the people at Brazos felt that they were “in different places in terms of their families, their business careers, and they want different things”.

Other Brazos executives left the firm to form Riata Capital Group in January 2015. 

Fojtasek, now managing partner at CenterOak, said the firm's fundraising had been helped by its “track record, focused investment strategy, and experienced and stable team”.

CenterOak will also focus on buy-and-build companies, similar to the executives' previous experience at Brazos, Fojtasek told PEI when the firm launched. The third and final Brazos fund closed on $715 million in 2008.

CenterOak credited the successful fundraise of their debut fund to their track record, focused investment strategy and experienced team. 

Over the years, CenterOak's team has managed over $1.8 billion of equity capital commitments and completed nearly 100 acquisitions, representing over $3 billion in transaction value, CenterOak said in its statement. 

The firm will target investments of $20 million to $90 million of equity capital in businesses with enterprise values of $50 million to $250 million, and will pursue buyouts and recapitalizations of closely-held or family-owned businesses as well as non-core subsidiaries of large public companies.

In February, CenterOak completed the acquisition of Spokane, Washington-based window and door manufacturer Cascade Windows through Fund I. The terms of the transaction were not disclosed. 

Credit Suisse acted as placement agent for the fund. 

In March 2015, CenterOak hired vice president Jeff Moredock, who also joined the firm from Brazos.