Resilience closes Fund III above target

The lower mid-market investor has raised $223m to invest in underperforming manufacturing and business services companies in the US.

Cleveland, Ohio-based Resilience Capital Partners has held a final close for its third fund on $223 million, above its $200 million target.

The lower mid-market investor raised significantly more capital for its third fund than its two previous vehicles, which closed on $20 million and $45 million in 2002 and 2006, respectively. Griffin Financial acted a placement agent for Fund III, which attracted roughly 80 percent new investors. Limited partners in Fund III include pension funds, insurance companies, foundations and endowments, fund of funds, wealth managers and investment consultants.

“What was important to us was to raise a fund from a diverse group of institutional investors without really any concentration in any one type of investor, as well as having a broad geographic contribution from the US as well as Europe,” Resilience co-chief executive officer Bassem Mansour told Private Equity International. Roughly 60 percent of the capital in Fund III comes from US investors, with the remaining 40 percent committed by investors in Europe and the Caribbean.

Resilience focuses on acquiring underperforming companies in special situations including turnarounds, restructurings or corporate divestitures. The firm targets businesses in the Midwestern and Mid-Atlantic US in the manufacturing and business services sectors. Resilience uses a five-person in-house operations team and four operating partners to drive improvements at portfolio companies.

“We’ve had circumstance where we have a specific researched investment thesis where we’re out pursuing opportunities specifically for somebody in a particular industry who’s one of our operating partners,” Mansour said.
Resilience has invested roughly 20 percent of Fund III to date in three transactions, acquiring mining and natural resources company North Coast Minerals, lumber business WT Hardwoods and temperature control product-maker Thermal Solutions Manufacturing. The firm targets platform businesses with $25 million to $250 million in revenues.

Resilience Capital Partners was founded in 2001 by Mansour, a former investment banker with McDonald Investments, and co-CEO Steven Rosen, a former executive at Merrill Lynch & Company.