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Arsenal Capital Doubles Down on Industrial and Healthcare M&A with Fourth Fund

Arsenal-backed PSG has made several acquisitions, including Alkon, Flow Polymers and Sasco

Arsenal Capital Partners has closed its fourth private equity fund, called Arsenal Capital Fund IV LP, at $1.3 billion. The firm has raised nearly $2.98 billion in investments since its inception in 2002.

Headquartered in New York City, Arsenal is a lower middle market private equity firm focused on industrial and healthcare companies with up to $250 million in enterprise value. More than 85 percent of previous investors re-upped in Fund IV. The remaining portion are new investors such as California State Teachers’ Retirement System, PensionDanmark and Sentry Insurance. Previous investors who committed to Fund IV include: The Regents of University of California, Northwestern Mutual and PPM America.

“The Arsenal high-growth, buy and build strategy and model continue to win in the market, as evidenced by the 34 platform investments and 21 realizations completed since inception, generating excellent returns for our investors,” says Arsenal co-founder Jeffery Kovach.

Arsenal has been actively investing with funds from the firm’s $875 million Fund III, which closed in 2012. In 2015, the firm formed Polymer Solutions Group from the acquisition of performance chemical maker Peach State Labs Inc. Since the acquisition, PSG grew its business with add-on deals that include: Alkon Solutions Ltd, a maker of liquid coatings and powder for the rubber industry; Flow Polymers LLC, a manufacturer of plastic and rubber additives; and Sasco Chemical Group, a producer of anti-tack agents for the rubber industry. Kirkland & Ellis LLP acted as legal counsel to Arsenal.

 

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