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Thomas H. Lee amasses $5.6bn for the ninth flagship buyout fund

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Laxman Pai, Opalesque Asia:

Thomas H. Lee Partners, a private equity firm investing in middle-market growth companies, has closed its latest flagship fund at $5.6 billion, representing a 56% increase in capital over its predecessor.

The buyout fund – Thomas H. Lee Equity Fund IX – focuses on investments in middle-market growth companies in sectors including technology and innovation, a news release said Monday. The press release did not disclose the amount of the fundraising target.

The previous fund, Thomas H. Lee Equity Fund VIII, closed at its hard cap of $3.6 billion in 2018, above its initial fundraising target of $3 billion.

Fund IX received strong demand from investors and over $250 million of General Partner commitments. A global and diverse group of new and existing limited partners have committed capital to Fund IX, including leading public and private pension funds, sovereign wealth funds, banks, insurance companies, endowments, foundations, family offices, and high-net-worth individuals.

Investors in the current fund include Massachusetts Pension Reserves Investment Management Board, Boston; Illinois Teachers’ Retirement System, Springfield; and Louisiana Teachers’ Retirement System, Baton Rouge.

“The successful fundraise speaks to the strength of our value creation capabilities and domain expertise, which allow us to move with speed and certainty to support our portfolio companies through their next stage of growth,” said Todd Abbrecht, Co-CEO of THL. “Particularly over the last decade, we have heavily invested in our firm to develop a roster of industry-leading talent, allowing us to work at a level of depth that can truly impact operating company performance. By developing a deep industry knowledge in our ISOs, we can identify the best opportunities and deliver unique value from day one.”

“Fund IX will continue THL’s strategy of investing behind its Identified Sector Opportunities (ISOs), which benefit from robust secular growth trends. Within its ISOs, THL focuses on investing in middle-market growth companies with high-quality business models and attractive return on invested capital characteristics,” said the release.