New York-based private equity firm Charterhouse Group exited NewPath Networks through a $115 million sale to Crown Castle International Corp. The firm, which backed entrepreneur Bill Marraccini, is selling the distributed antenna network operator after a holding period of just over 14 months.

The deal concludes Charterhouse’s second successful venture with Marraccini. The firm previously backed AAT Communications Corp., pouring over $150 million into the buildup of the tower operator before selling the company to SBA Communications in a 2006 deal. The sale of AAT was valued at over $1 billion.

For NewPath, Charterhouse initially invested $20 million last April and then followed up with another $10 million investment soon after. The fund, itself, held a significant minority stake, although combined with Marraccini, shared control of NewPath.

Charterhouse initially tapped Citi to raise additional outside capital. According to Charterhouse managing director David Hoffman, the capital raise quickly morphed into a “highly charged” auction for the company, comprised primarily of strategic bidders.

While unexpected, the timing of the sale benefits Charterhouse, whose fourth fund is almost fully committed. A source told Mergers & Acquisitions that the firm has been in contact with its existing limited partners for a follow up fund.

The firm’s 2004-vintage Fund IV had approximately $450 million of capital, with an LP base that included AlpInvest, Goldman Sachs and JPMorgan Chase.

Reportedly, Charterhouse had planned to launch the new fund in 2008; an effort that was likely scotched by the downturn. In late 2007, Buyouts Newsletter reported that Fund V would have a $750 million target.

Hoffman, however, declined to comment on a potential fundraising.

Hoffman also declined to comment on the return generated from the sale of NewPath. Considering the timing, however, the exit likely resulted in an attractive IRR.

The firm has secured a number of big exits in recent years. It sold Amerifit Brands to Martek in a $200 million deal this past January. Three years ago, Charterhouse also scored big with sales of Lason Inc., representing a 5x return on equity, and Oakleaf Global Holdings, which generated a 7x cash-on-cash return.

For Crown Castle, the deal followed the pricing of $1.55 billion of senior secured notes. Analysts following the company’s stock cite that Crown Castle is in position to either buyback shares, issue dividends or reinvest in its business through additional M&A.

Infrastructure (M&A) Technology