California-based HGGC has closed its sophomore fund on $1.33 billion, beating the $1 billion target. The fund includes a significant GP commitment, with HGGC professionals representing the largest investment group.
Known new investors in the fund include PKA AIP, the alternative investment arm of Danish pension fund administrator PKA, and OP Trust in Canada. The Public School Employees' Retirement System of Pennsylvania also committed $100 million to the fund as PEI reported in January.
Like its predecessor vehicle, Fund II will make control investments in middle market companies and will provide co-investment opportunities to LPs.
To date, HGGC has made four platform investments from Fund II including AutoAlert, a provider of auto market software; Pearl Holding Group, a provider of underwriting, claims and policy services to insurerers; Serena Software, the largest independent provider of IT application development and deployment solutions; and Survey Sampling International, a provider of data solutions and technology for consumer and business-to-business research. With these investments, the fund is 20 percent deployed.
HGGC says it is targeting 10 investments for Fund II through its “advantaged investing” model, which incentivizes management teams and founders to roll over equity into transactions. The firm targets companies with enterprise values of $100 – $500 million.
HGGC is led by Rich Lawson, Hall of Fame Quarterback Steve Young, former Bain Capital executive Greg Benson and former Citigroup CFO Gary Crittenden.