Monomoy spinout MiddleGround gets anchor backing from Moelis joint venture

  • MiddleGround hit fundraising market this summer
  • Firm got $75 mln anchor pledge from Moelis-Veritable JV
  • Targets lower-middle-market B2B industrial companies

MiddleGround Capital, a spinout from Monomoy Capital Partners, got a helping hand as it raises its debut fund.

The firm received anchor backing from Archean Capital Partners, a joint venture of Veritable and Moelis Asset Management.

MiddleGround is targeting $350 million for its first-time fund for investments in lower-middle-market business-to-business industrial companies in North America, Buyouts reported.

The $75 million anchor commitment would bring the Fund I target to $425 million, according to an LP source with knowledge of the situation.

The anchor relationship does not include a stake in the management company, often an aspect of such deals, a source with knowledge of the firm said. Archean likely would assist with administrative, back-office-type tasks, the person said.

MiddleGround’s Form ADV filed September 2018 shows the firm had $79.5 million in AUM.

The firm made its first investment this summer, buying Alco Manufacturing from Blue Point Capital, sources said. MiddleGround targets companies with less than $200 million of enterprise value.  

Ex-Monomoy Partner John Stewart and Directors Lauren Mulholland and Scot Duncan left the firm last year and formed MiddleGround this year.

Stewart and Duncan both have extensive operating experience in their backgrounds at Toyota.

Stewart spent years as a manager at Toyota, his LinkedIn profile shows. He joined Monomoy in 2007 and was made partner in 2016. He rose to co-lead PE investments and also headed the operations group, he said in his profile.

He is joined by Duncan, who started at Monomoy in 2008, prior to which he also worked at Toyota, involved in engineering and production, an archived version of his profile shows.

Mulholland, who joined Monomoy in 2011, rounds out the team. Before Monomoy, she was an associate at Macquarie Group.

Action Item: Check out MiddleGround’s Form ADV here: