WSJ Reports on Altas Partners Fund II Closing


November 4, 2019 — Laura Cooper and Chris Cumming, Wall Street Journal

Altas Partners Raises $3 Billion for Second Longer-Life Fund

Andrew Sheiner’s firm generally makes two investments a year, which it can hold for as long as 15 years

Altas Partners, a firm founded on the idea that some private-equity investments can benefit from having more time to ripen, has amassed $3 billion for its second fund.
 
The vehicle, Altas Partners Holdings II LP, was oversubscribed and closed at its hard cap, the Toronto-based firm said Monday. The new fund was raised with the help of Park Hill Group, according to a Securities and Exchange Commission filing.
 
At $3 billion, Altas’s new fund is triple the size of its maiden offering, which closed at $1 billion in 2016.
 
Altas, which was founded in 2012 by former Onex Corp. executive Andrew Sheiner, is one of the pioneers of longer-term private-equity investing. The firm can hold companies it buys for as little as five years, which is standard for private-equity investments, or as long as 15 years, which is beyond the 10-to-12-year maximum hold time typical for private-equity managers.
 
The firm’s second vehicle will continue the strategy of the first fund, said Mr. Sheiner, who is the firm’s managing partner as well as founder. Altas generally makes two investments a year, targeting deals worth $250 million to $1 billion in equity in sectors including industrials, health-care and education. The debut fund made five investments.
 
Longer-term investing has become more common over the past decade, as firms and investors have come to see benefits in having the option of a longer hold period. Longer-term funds also typically charge lower management fees than traditional buyout vehicles.
 
Firms that have launched longer-term funds in recent years include Vista Equity Partners, CVC Capital Partners, KKR & Co. Inc. and Blackstone Group Inc. So far this year, 15 longer-term funds have closed on a total of $5.3 billion, according to data provider Preqin Ltd.
 
Altas’s latest fund has already made its first investment, backing specialty chemical supplier DuBois Chemicals Inc. in a deal signed over the past summer. Earlier this year it closed on the $400 million purchase of the University of St. Augustine for Health Sciences, an educator of physical and occupational therapists with campuses in California, Texas and Florida.