CAI Capital beats target with $125M for latest fund
Despite the global pandemic bearing down on businesses around the world, Vancouver-based private equity firm CAI Capital Partners exceeded a $100-million target for its latest fund by more than 25 per cent.
More than 80 returning investors, and some new ones, pumped $125 million — the hard cap — into CAI's Fund VI.
The investment firm, which targets the “lower middle” segment of the market, has continued to invest throughout the economic turmoil caused by government-mandated efforts to try to slow the spread of COVID-19.
For example, in August, CAI invested in RebalanceMD Canada, a Victoria-based operator of medical clinics that provide musculoskeletal care including a full range of orthopedic surgical and non-surgical services.
And on Sept. 30, the fund announced an investment in CMT Engineering Laboratories, a Utahbased civil and geotechnical engineering services provider.
“The pandemic certainly made raising the fund more complicated,” said Curtis Johansson, a partner at the firm.
“But it doesn't negate the underlying premise upon which CAI is built: the lower middle-market is a compelling place to invest.”
Investors in CAI's latest fund include financial institutions, family offices, institutional investors, funds of funds and individuals.
Over the past three decades CAI, which was originally based in New York, has invested more than $1.5 billion of equity capital in companies across North America.
One of its funds, launched in 2008, topped a list of more than 100 global buyout funds of that vintage based on the return on each dollar invested, or net multiple, according to Preqin, a London-based data firm that tracks private capital and the hedge fund industry.
CAI primarily focuses on investing in founder-owned companies, often in sectors that serve industries where services are required by regulation or government.
“As we always have, we are targeting businesses that demonstrate a track-record of cash-flow generation and unrealized growth opportunities,” said Johansson.
“In particular, we think there are currently compelling opportunities to partner with companies that provide services to industrial, utility and government clients.”