Mack Leaves Alta As Firm Changes Strategies–UPDATED

Wayne Mack, a former partner with private equity firm Alta Communications, has formed Stratus Media Holdings.

Mack left Alta Communications in June of last year, an official said. The firm now has five partners, according to its website. Mack spent nearly eight years at Alta, joining the media-focused PE firm in November 2003.

Mack says he formed Stratus Media in January with a group of investors. “I had another opportunity so I took it,” he told peHUB.

The Davenport, Iowa-based company provides broadcast services to the television industry. Mack, a sole manager, owns a “17% membership interest” in Stratus Media, according to an FCC document.

Stratus, in January, announced it had purchased the the assets of Fusion Communications and The Independent News Network, as well as TV stations KWWF in Cedar Rapids/Waterloo, Iowa and KDEV in Cheyenne, Wyo.

The status of Mack’s former PE firm has come into question. Alta last tried to raise a fund, Alta Communications X, in 2008. The pool had a $250 million target but doesn’t appear to have closed, according to data compiled by Thomson Reuters (publisher of peHUB). Alta last raised a fund 10 years ago — Alta Communications IX, a $500 million vehicle, according to Thomson Reuters. That fund has a -4.4% IRR since inception, according to March 31 data from CalSTRS, a limited partner in fund IX.

Alta’s fund VIII, raised in 2000, has an IRR of -6.67%, CalSTRS says.

Alta made one investment in 2011 and four in 2010, according to Thomson Reuters.

UPDATE: Faced with the global financial downturn that was consuming the broad market, Alta, in January 2009, decided against fundraising for its tenth pool, says Tim Dibble, an Alta managing general partner. “We didn’t think it would be successful,” he says. “We never went to market for fund X.”

In 2010, the fundraising market remained difficult and the PE firm again decided against marketing. Alta that year morphed into a different model, Dibble says. The firm began using its own capital for deals and occasionally brought in former LPs to invest in smaller companies, Dibble says. Alta’s fund IX is fully invested for new deals but has a reserve for follow-ons, Dibble says.

“Rather than do mid-sized or larger communications deals, Alta is doing smaller deals of all sorts,” Dibble says.

Alta has also changed its name. The PE firm is now known as Alta Equity Partners and targets a variety of industries, not just communications, in the lower middle market. It typically invests $2 million to $20 million per deal, according to the firm’s website. In contrast, Alta Communications invested from $10 million to $30 million per deal in media and telecommunications.

Alta has completed three deals under its new model. It acquired SJL Broadcasting in 2011. The year before, in 2010, it bought CombineNet Holdings and SubContracting Concepts.

Mack declined to comment on Alta.

(The original headline of the story was changed to reflect the updated material.)