Firms & Funds

Siris heads for January final close on largest fund yet

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Siris Capital Group, private equity
Photo of Frank Baker sourced from Siris Capital website
  • Siris IV expected to close in January
  • Fund has been in market since last year
  • Firm recently announced deal for Travelport

Siris Capital, a tech-focused firm that has grown quickly, is expected to hit its $3.5 billion hard cap on its fourth fund in January, a source said.

Siris Partners IV will be its largest to date, eclipsing Fund III, which closed on $1.81 billion in 2015.

Siris is essentially done fundraising and is waiting for last-minute LPs to finalize their commitments, the source said.

A spokesman for Siris declined to comment.

Park Hill Group is placement agent.

Fund IV hit the market in fall 2017 and was expected to close earlier this year. It’s unclear whether the fund close was delayed.

Fund IV is charging investors a 1.75 percent management fee on committed capital during the investment period, a StepStone Group investment memo created for Connecticut Retirement Plans and Trust Funds shows.

Afterward, the fee falls to 1.5 percent of invested capital, minus realized investments or write-downs, the memo said.

Siris targets mature tech companies with legacy brands that are trying to develop new products. The legacy business is viewed as the cash generator, or “bond portion” of the deal, Buyouts reported.

The new, more speculative products the firm considers the “call option” part of the investment, Buyouts reported.

Siris was launched by Peter Berger, Frank Baker and Jeffrey Hendren, who worked together at Ripplewood Holdings in the 1990s. The three spun out to join hedge fund S.A.C. Capital Advisors in 2007, investing out of a side-pocket vehicle they set up.

Siris closed Fund II, its first institutional fund, on $651 million in 2011. Siris II was producing a 17.6 percent net internal rate of return and a 1.5x multiple as of March 31, 2018, performance information from California Public Employees’ Retirement System shows.

Siris Partners III was generating an 11.7 percent net IRR and a 1.1x multiple as of that date, CalPERS said.

In early December, Siris and Evergreen Coast Capital agreed to buy Travelport Worldwide in a deal valued at about $4.4 billion. The firm also this month hired Joe Cozzolino as an executive partner. He was most recently a senior vice president and worldwide general manager at Cisco Services.

Action Item: Check out Siris’s Form ADV here: https://bit.ly/2BJtew9