For the first time, Clayton Dubilier & Rice has raised more than half of the capital in its new flagship fund from limited partners outside of North America, according to Donald Gogel, the firm’s chairman and chief executive officer.
CD&R had been raising its ninth fund for about a year, collecting a total of $6.4 billion, including the GP commitment (and turning down about $2 billion, according to sister news service Reuters). Fund IX officially closed in early May.
LPs from outside of North America included sovereign wealth funds concentrated in Asia and the Middle East, Gogel said. “Obviously, quite different than the first fund I raised at Clayton, Dubilier & Rice, where less than 20 percent was non-North America,” Gogel said.
Gogel also spoke about the firm’s use of operating executives. The firm’s operating expertise allows it to keep putting money out even in difficult times, Gogel said. “We have invested pretty steadily through this last cycle, about $1 billion each year for five years,” Gogel said. “That’s what we hoped to do in our 2009 fund. But even in these difficult times, we’re able to put money to work if we have an operating executive who can help us recognize what we will do if we own a business.
“The operating partner has the responsibility and takes it very seriously to deliver the results that he and the management team are committing to us,” Gogel said.
CD&R has both full-time operating partners who are employees of the firm, and a group of advisors that get compensated by the funds or portfolio companies, according to a regulatory filing with the SEC. The non-employee advisors have been called “advisory operating partners,” “special partners,” “operating advisors,” or “senior advisors,” according to the filing.
Photo courtesy of Shutterstock.