Kevin Dowd December 19, 2016
Kohlberg & Company has held a final close on $2.2 billion for its eighth flagship buyout fund, an oversubscribed vehicle that received commitments from more than 70 LPs. The previous vehicle in Kohlberg’s primary fund series, Kohlberg Investors VII, closed on $1.6 billion in 2013. Like all of the firm’s funds, the new vehicle will be put to use investing in the middle market.
That thesis has been ingrained at Kohlberg & Co. for the full 30 years of the firm’s existence, ever since Jerome Kohlberg split off from KKR co-founders Henry Kravis and George Roberts in 1987 citing "philosophical differences." The largest of those differences was apparently KKR’s gradual shift toward mega-deals—Kohlberg didn’t necessarily enjoy being a barbarian at the gate. As Roberts told The New York Times when they split: "Jerry may have felt that the deals were getting too big."
At Kohlberg & Co., he was able to return to his middle-market roots, continuing to lead the firm until his retirement in 1994. While Kohlberg died of cancer in 2015, his namesake still conducts the sort of business he preferred: It usually invests between $50 million and $300 million in American companies with revenues ranging from $100 million to $1 billion that operate in the industrial manufacturing, consumer, business services, healthcare services and financial services industries.
In recent years, the firm’s activity has been on the uptick. Kohlberg & Co. has completed 13 investments so far this year, according to the PitchBook Platform, after 15 deals last year and 14 in 2014. Before that, the firm hadn’t made more than 10 investments in any year this decade. Just about 90% of those deals were concentrated in the B2B, B2C, healthcare and financial services sectors.
Interested in more info? Platform subscribers can learn more about Kohlberg & Co.’s past deals, closed funds, management team and more on the firm’s PitchBook profile.