Riverside holds second close on road to $900m

The New York middle market specialist has rounded up $550m for Riverside Capital Appreciation Fund V, a source has confirmed.

The Riverside Company has held a second close on $550 million (€345 million) for its fifth middle market general fund.

The Cleveland, Ohio-based firm is also close to securing an additional $200 million in commitments in the near term as it approaches the $900 million target for Riverside Capital Appreciation V, according to a source familiar with the fund.

Riverside declined to comment on its specific fundraising activities.

“[Limited partner] appetite has shifted from mega-deals to smaller deal funds, and we can satisfy that need,” Riverside co-founder Bela Szigethy told PEO. “Our services, our products fall squarely in the general areas in which LPs are seeking to make investments.”

Szigethy also cited the mid-market specialist’s expansion into Europe and Asia as a key factor in attracting an eager and more geographically diverse investor base. The firm is currently raising its first dedicated Asia fund, with a target of $100 million, after opening offices in Tokyo and Seoul last year.

The rapid pace of Riverside’s recent fundraising efforts may surprise many who thought that the firm’s decision to raise its carry rate from 20 percent to 25 percent would damper limited partner enthusiasm for their funds.  Riverside launched its latest fund in March of this year.

Riverside typically targets the small end of the middle market, investing in companies valued up to $200 million.