Clearlake Capital Seeks $600 Million With Newest Fund

Clearlake Capital Group is out fundraising for its latest PE fund, four sources say.

The pool, Clearlake Capital Partners III L.P., has a $600 million target, one person says. Clearlake started fundraising in June; Park Hill is the placement agent, sources say.

Clearlake’s last fund raised $410 million in 2010. Fund II has an amazing net IRR of 48.4%, according to Dec. 31 data from CalPERS. I called CalPERS to check if the IRR is right but have yet to hear. But it looks like it is. While IRRs may vary from investor to investor, the figures cited by CalPERS are not “inconsistent” with Clearlake’s overall fund returns for its second pool, a different source says.

Another person says the 48.4% IRR is right. Clearlake “had some early winners which skewed returns upward. It should go quick,” the source says.

New York-based Clearlake Capital is a special situations fund that targets companies in business services, communications, consumer, healthcare, industrials, and technology. Steven Chang, Behdad Eghbali, and José Feliciano founded Clearlake in 2006 in partnership with Reservoir Capital.

The firm has invested in Smart Sand, a provider of proppant to the oil and gas industry. The PE firm, earlier this year, took a majority stake in Entelos Holding, a supplier of silico modeling and simulation products for the pharmaceutical industry. Clearlake also recapped Solutionary, which provides security services, in late 2011.

Clearlake declined comment. Officials for Park Hill couldn’t immediately be reached for comment.

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