Insight Equity Taps Heads to Market With Second Fund

Insight Equity has hired UBS to help it raise its second fund, sources familiar with the effort said. The Dallas-based turnaround firm announced its fund raising plans to LPs at its investor meeting last week and will begin its formal marketing process in the coming weeks. The firm is planning a “substantial” increase in fund size, one source said.

Insight Equity raised its debut fund in 2005, securing $300 million in commitments—that’s $50 million over their target—with UBS acting as its placement agent. That pool of capital is around 70 percent committed, the sources said.

Since then, Insight Equity has made around 10 investments in companies like synthetic turf maker Sportexe and Vision-Ease Lense Worldwide, a supplier of optical lenses. It has no full exits but has taken dividend recaps from almost all of its companies, including Brenner Tank, Direct Fuels, Walker Group and Hirschfeld Holdings.

The firm’s focus is asset-heavy companies in financial distress. It was founded in 2002 by two Carlyle Group veterans and one former Bain & Co. senior manager. Earlier this year one of those founders, Ross Gatlin, left to form his own Dallas-based turnaround LBO shop, called Prophet Equity. According to an industry report, the firm plans to raise a $200 million fund.

Insight Equity declined to comment.