GI Partners hits $2bn hard-cap

The Menlo Park, California-based firm’s fourth fund beat its $1.5 billion target.

GI Partners has closed its Fund IV at its $2 billion hard cap, surpassing its $1.5 billion target, according to a statement.

Investors in Fund IV include domestic public and corporate pension plans, sovereign wealth funds, fund of funds, foundations and family offices. The Washington State Investment Board and Denmark pension PKA are both limited partners in the fund, according to PERE's Research & Analytics division.

UBS Securities acted as placement agent for Fund IV, according to the statement. However, Merrill Lynch also received sales compensation from the fund, according to documents filed with the US Securities and Exchange Commission in August 2013.

Fund IV will follow the same investment strategy of GI’s prior funds, which have made control investments in mid-market North American companies with enterprise values between $100 million and $750 million. Investments typically range between $50 million and $250 million, according to the firm’s website. GI focuses on the retail, logistics and transportation, media and entertainment, financial services, technology, telecom and real estate sectors.

GI’s Fund III raised $1.9 billion of a $2.5 billion target in 2009, according to PERE data. The fund received commitments form limited partners such as Swiss fund of funds manager Capital Dynamics, Netherlands pension administrator APG Asset Management and the Florida State Board of Administration.

Investments by GI’s Fund III include New York-based commercial real estate finance company Ladder Capital Finance and Wave Broadband, which provides cable systems in the suburban markets of Portland, Sacramento, San Francisco and Seattle. GI still is managing one investment – California-based Duckhorn Wine – from its Fund II, which closed on $1.45 billion in 2006. The firm acquired Duckhorn in 2007.

GI was founded in 2001 by Rick Magnuson, former co-founder and chairman of data center provider Digital Realty Trust. Last month, the firm hired David Smolen as general counsel and chief compliance officer. Smolen joined the firm from Silver Lake Partners, where he was senior counsel and CCO, according to GI’s website.

GI manages more than $10 billion through private equity and real estate separate account strategies for global pension plans and sovereign entities. The Menlo Park, California-based firm has invested $2.2 billion in 24 investments through its three previous funds, according to its website. GI has not made any investments or exits so far in 2014.