Denver Shop Eyes $350M For Third Buyout Fund

Denver-based Platte River Ventures expects to start raising its third fund in the coming weeks, sister magazine Buyouts reported yesterday, citing two sources.

The firm is expected to seek to raise $350 million for the fund, Platte River Ventures III LP, a healthy step up in size from the $235 million in commitments raised for its second fund, a 2008-vintage vehicle. Capstone Partners, a placement agency, is helping to raise the fund.

Platte River Ventures typically invests $5 million to $40 million in equity in companies generating revenues of between $10 million and $150 million. Industries of interest include aerospace manufacturing and services; industrial products and services; metals, chemicals and natural resources; and energy services and infrastructure. The firm  typically seeks control of its target companies, although in some cases it will take minority stakes.

In a move that could bolster its pitch to investors Platte River Ventures announced on May 14 an exit of a roll-up in the aerospace and defense market. The firm sold PRV Aerospace LLC, an Everett, Wash.-based aerospace and defense company that supplies components and other products to aircraft manufacturers, to Court Square Capital Partners. The price was not disclosed. Platte River Ventures formed PRV Aerospace in January 2010 by combining four aerospace companies it had bought between 2006 and 2008; once combined, the company also completed two add-on acquisitions.

Besides PRV Aerospace, Platte River Ventures’s other exit came in April 2008, when fertilizer producer Intrepid Potash Inc. raised $960 million in its initial public offering. The firm had bought a minority interest in the company in 2007. Its return on the investment is unclear.

Managing Director J. Landis Martin, a longtime executive in the industrial sector whose most recent post was CEO and chairman of Titanium Metals Corp., founded Platte River Ventures in 2005. The firm employs nine investment professionals.

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Bernard Vaughan is a senior editor at Buyouts Magazine. Follow his tweets @BVaughanReuters. Follow Buyouts tweets @Buyouts.