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Gen Cap Closes Seventh PE Fund to Back Companies in the Lower Middle Market

Airsoft gun and outdoor equipment maker Pyramid is the first middle-market business to receive investments from the fund

Gen Cap America Inc. has raised $250 million in capital commitments for the firm’s seventh private equity fund, Southvest Fund VII LP. The fund's predecessor, Southvest Fund VI LP, closed in Mar. 2009 with the same amount.

Southvest Fund VII LP was raised in less than a year with commitments from institutional investors including state and municipal pension plans. Gen Cap will use the fund to invest in management-led buyouts and recapitalizations of lower middle-market businesses. The PE firm targets businesses with revenues between $5 million and $100 million. Gen Cap exited its investment in Re-Bath Corp., a manufacturer of bathroom remodeling products which it invested in using Southvest Fund VI LP, in 2010.

"As our national economy continues to improve, there are increasing attractive buying opportunities with strong upside,” states Gen Cap EVP Don Napier. "We believe this is an opportune market for our strategy of investing in successful manufacturing, service and distribution companies with strong market share, and we’re pleased to already have our first portfolio company on board.”

Gen Cap, founded in 1988, is a private investment firm based in Nashville, Tennessee. The PE firm made its first acquisition in Pyramid Air Ltd with capital from the new fund in Nov. 2016. The target distributes air guns, airsoft guns, BB guns and related accessories to more than 80 countries.

Private equity firmsáhad an eventful year of fundraising in 2016. Recent fund raises include:áKainos Capital’sáraising a $895 million credit fund; Jaguar Growth Partners’á$350 million fundraise for the firm’s first real estate fund; Carlyle’sá$2.8 billion credit fund for the energy deals; and Carousel Capital’sá$400 million buyout fund.

 

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