Marlin Equity Partners New $1.6B Fund To Make AUM Splash

When it comes to the middle market, Marlin Equity Partners appears to be moving up in a big way with a $1.6 billion target for its latest buyout fund, Marlin Equity IV LP.

If successful, the Hermosa Beach, Calif., private equity firm founded by deal maker David McGovern will bring the value of its total funds under management to $2.6 billion, nearly  triple its current $1 billion level. That’s probably worth a notch or two in the world of medium-sized shops.

Also impressive, the fund’s hefty fundraising target comes as general partners complain of a difficult  environment for attracting cash.

The latest fund will greatly surpass the $650 million it drew for its 2009 fund, Marlin Equity III LP. That effort surpassed its $450 million fundraising target by $200 million.

Credit Suisse is acting as placement agent for Marlin Equity IV LP.

Marlin’s effort to become a bigger fish comes after a string of interesting deals, including its acquisition of the optical networking business of Sycamore Networks in January.

Pointing toward more deals in the space to come, Marlin Equity Principal Doug Bayerd said the acquisition paves the way for more add-ons and carve-outs.

“We plan to make the necessary investment to further enhance Sycamore’s current product offerings,” he said at the time. “We are committed to building on Sycamore’s market leading position through strategic acquisitions.”

That’s brave talk indeed at a time when lofty stock prices are pushing up price tags for target companies.

But if Martlin Equity continues growing at this rate, it could soon find itself bidding against Silver Lake or other mega-sized buyout shops.

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