Fund II is currently investing primarily in subordinated notes, as well as limited amounts of preferred and common stock. In conjunction with these financings, warrants, conversion features or other types of equity participation will be obtained. Fund II also finances change of control, recapitalization and later-stage growth transactions for established and successful lower-middle-market businesses.
Change of control transactions entail the acquisition of an existing business, usually as a spin-off of a division or business unit from a parent organization, or, a family-owned business being sold for liquidity or estate planning reasons.
Recapitalization transactions can involve the raising of debt in order to provide partial liquidity to business owners or further strengthen a company’s balance sheet.
Later-stage financings can involve mezzanine or equity capital to continue, or accelerate, growth, including the acquisition of “add-on” businesses or product line extensions.