Firms & Funds

Kline Hill preps for Fund II targeting up to $350 mln

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Emil Capital, Data Council, private equity, merger, M&A, Tengelmann
A resident skies through a park during a snow storm in Old Greenwich, Connecticut January 23, 2016. A monster blizzard that has paralyzed much of the U.S. East Coast intensified on Saturday as it barreled into New York City, forcing the closure of all bridges and tunnels into the largest U.S. city and prompting a travel ban on area highways. REUTERS/Adrees Latif
  • Firm: Kline Hill Partners
  • Fund: Kline Hill Partners Fund II
  • Target: $300 mln
  • Hard cap: $350 mln
  • Amount Raised: N/A

Kline Hill Partners, which focuses on small secondaries, is talking to limited partners about its second fund with a hard cap of $350 million, according to a person with knowledge of the situation.

Kline Hill Partners II, which is targeting $300 million, could launch in September, the person said.

The Greenwich, Connecticut, firm’s debut fund closed in December on its $180 million hard cap and is about 75 percent deployed, the person said. The firm had been investing the fund through the fundraising, which began in 2015.

Kline Hill also will expand its investment team, the person said.

Kline Hill was formed by Managing Partner Mike Bego, formerly of Willowridge Partners, in 2015. Other investment professionals at the firm include Partner Jared Barlow and associates Graham Douglas and Tom Melly. Danielle Buccola is vice president of finance and operations.

Cambridge Associates’ former head of PE secondaries, Priya Pradhan Karkar, advises the firm.

Kline Hill has kept busy transacting in small deals, a niche area that most other firms avoid. The firm typically targets smaller, more fragmented deals.

“It’s an area where there’s an awful lot of work to put out a small amount of money,” Bego told Buyouts in a prior interview. “That deters a lot of people. It’s fairly labor-intensive.”

Sellers in this area of the secondary market can be institutions like banks that have pockets of small fund interests. An example would be a large bank that in the past has acquired smaller companies with portfolios of small fund holdings.

As of the second quarter, 45 secondaries funds were in market seeking $32.4 billion, alternative-assets-data provider Preqin says. Secondaries funds held $87 billion in uncalled capital as of the end of June, Preqin said.

Action Item: Kline Hill’s Form ADV: http://bit.ly/2vALDtU

A resident skies through a park during a snowstorm in Old Greenwich, Connecticut, on Jan. 23, 2016. Photo courtesy Reuters/Adrees Latif