Peachtree Equity raises $60M for lending fund - Triangle Business Journal:

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The fund, called Peachtrese II L.P., is the second createe by the private equity firm since opening its doorsain 2002, and one of the largesgt fund closings in Atlanta since the recession beganh in January 2008. Peachtree Equity’z new fund, licensed as a small-business investmengt company bythe , will provid capital to companies that can’gt fully finance expansion or growth projects through a bank, also knowj as mezzanine lending.
Given the continuerd instability of bank credit available to Peachtree Equity partner David Christophe r said the fund will have no shortageof “We think this is a good time from a marker perspective,” said Christopher, one of the thres partners at Peachtree “This market is creating attractived opportunities.” The fund will lend at leastg $3 million to $10 million to small businesses, typically those with less than $100 millionj in annual revenue and with $2 million in The fund will focus on working with the existingh management of companies, looking to grow through organixc processes or outside acquisitions.
The firm’sd investments will continue to be in thenichew manufacturing, health-care, business and financialo services, and government contractor sectors. But with the opportunityh comesincreased competition. Mezzanine funds are one of the growinb sectors ofprivate equity, with several scattere throughout the city and the Christopher said despite the newfound popularity of mezzaninre investment by local privatw equity firms, the firm isn’t afraid of widesprea local competition. “We’ll co-invest with otherf firms and the other mezz playersout there,” he “We don’t see them as necessarily direct competition.
” The $60 milliojn raised is the first closing of the Christopher said the fund is ultimately projecteds to raise $75 million to $100 millio n by year’s end with additional investor commitments. The new fund is smallet than Peachtree Equity’s first fund, which raised $110 million and ultimately invested in 17 companies base d primarily inthe Southeast. The compan does not discuss publicly the investmenty performance ofits funds. Peachtree Equity was created in when the executives whobeganb ’s private equity investment business in 1997 left to form theifr own local firm.
Since then, two of the founder s have left for other localp privateequity firms, which Christopher said was a challengd fundraising for the second time. Despitre the departures, the firm is expanding with the second Peachtree Equity also hired private equity veteran Wendelll Reilly as a general Reilly previously founded andoversaw LLC, a venture capital-backed grou of television stations, and now serves as the managinhg partner of , a private equity firm focusesd on media industry investment. Christopher said the firm is also lookingb to hire two more junior and one analyst to work with the new fund and managw the current stable ofportfolio investments.
Christopher said he expects the secondx fund to ultimately closre 12 to 15 investment deals overthe four-yea r life of the with a preference for Southeasterj or local deals.