Fleet’s Chisholm to Make Three Broadband Plays –

Fleet Equity Partners has wasted no time in putting its newly-raised capital to work-since closing Chisholm Partners IV in Spring, the Providence, R.I., private equity group has made two investments and inked three agreements with telecommunication platforms.

Fleet Equity last month agreed to invest $30 million in Clear Source, a Texas company that links homes and businesses to fiber optic networks. Habib Gorgi, a managing director at Fleet Equity, declined to name the area of Texas in which Clear Source will operate, citing competitive reasons. “There are a lot of moving parts [in the industry] and people are looking at markets all over the country,” he said.

In addition, Gorgi said Fleet Equity had inked deals with two additional broadband facilitating companies, but declined to name them. All three companies are early-stage businesses.

Fleet Equity has invested in similar companies in the past-in June, the firm invested $7 million alongside Willis Stein & Partners in the acquisition of LISN, which provides engineering, furnishing and installation services to the telecommunications industry.

Fleet Equity also has been active in the manufacturing sector-last month it joined Palladium Equity Partners and other investment groups in the acquisition of Mediapak Corp., a compact disk case manufacturer (BUYOUTS Aug. 16, p. 6).

In July, Fleet Equity made an investment of undisclosed size in health-care management services company Meridian Health Care Management, giving the investment group an approximately 50% stake in the company.

The investments mark the first five for Chisholm IV, which rounded up a total of $275 million. Fleet Equity manages the Chisholm funds for third-party investors, while Fleet Equity has funds of its own comprised of money from the group’s managing directors and from parent company Fleet Financial Group Inc. The two groups invest side-by-side on all deals.

Limited partners in Chisholm IV include Fleet Financial, New York State Teachers Retirement System, Idaho Public Employees’ Retirement System, California State Teachers’ Retirement System, Heller Financial, and First Union Capital Partners.

Chisholm’s fourth fund also is much larger than its third effort, which held a final close in 1996 on $45 million. Gorgi said his firm was comfortable with the increased size-Chisholm, which has nine managing directors, has many proprietary relationships that allow for a quick investment pace. “We’ve been around for a long time and deal flow has never been a problem for us,” Gorgi said.

Fleet Equity focuses on the telecommunications services, media, manufacturing, business-services and health-care sectors. The firm looks to invest between $10 million and $50 million in equity per deal.

Fleet Financial is in the process of acquiring BankBoston Corp., which also has private equity programs through BancBoston Capital and BancBoston Ventures. However, the respective private equity programs of Fleet Financial and BankBoston will not be merged or otherwise compete with one another, said Rick Fritz, president of BancBoston Capital and BancBoston Ventures, in an earlier interview (BUYOUTS Mar. 22, p. 4).