Riverside closes Fund VI on $1.5bn

The Riverside Company has closed its Riverside Capital Appreciation Fund VI on $1.5 billion, surpassing its $1bn target, according to a statement.

Fund VI, which is Riverside’s largest fundraise to date, having been launched in summer 2012. The firm held a first close on $605 million last year.

Fund VI received commitments of $100 million each from the Employees Retirement System of Texas and the Maryland State Retirement and Pension System, Private Equity International previously reported. Other limited partners include Florida State Board of Administration, the State of Oregon and investment manager Makena Capital, according to the statement. More than 40 percent of the capital raised came from new LPs, which were primarily US-based institutional investors such as the Washington State Investment Board.

Riverside employees also committed more than $60 million to the fund, marking the firm’s largest general partner commitment by dollars to date.

“The fundraising environment has gotten considerably tougher over the last 25 years we’ve been in the business,” Riverside co-chief executive officer Béla Szigethy said in the statement. “Investors are rightfully demanding and very selective about where they entrust their money, and we’re delighted to have earned that trust.”

Fund VI invests in lower mid-market companies, primarily in North America, with enterprise values of up to $250 million and earnings before interest, taxes, depreciation, and appreciation of between $5 million and $25 million.

“We’ve already started deploying RCAF VI, and we’re seeing tremendous opportunities to help companies thrive,” managing partner Suzy Kriscunas said in the statement.

Riverside’s Fund V closed on $1.17 billion in 2009, above its $900 million target. The fund had completed 27 platform acquisitions, as of May.

Riverside is also targeting $150 million for its Asia-Pacific Fund II, which has held a third close on $135 million, according to documents filed with the US Securities and Exchange Commission Wednesday. The fund launched in 2012 and held a second close on $115 million in July. Riverside declined to comment on fundraising.

Riverside exited 11 companies in 2013, including its December sale of workers compensation medicine network, Align Networks, to Apax Partners, which generated a return multiple of more than 12x. The firm also made 22 acquisitions last year, including electronics manufacturer Blue Microphones and branded dog toy designer and distributor Kyjen.

Riverside was founded in 1988 and is led by co-chief executive officers Szigethy and Stewart Kohl.