(Reuters) — Friedman Fleischer & Lowe said on Wednesday it had raised $2 billion for its fourth private equity fund, its largest to date.
The firm, based in San Francisco, usually makes equity investments between $75 million and $250 million in companies in industries ranging from consumer products to business services. It plans to make 15 to 20 investments in the fund, co-CEO and President Spencer Fleischer said in an interview.
With its new fund, FFL will stick to its strategy of buying or investing in companies without using a lot of debt, borrowing less than two times a company’s annual earnings before interest, tax, depreciation and amortization.
“We typically use less leverage than the rest of the industry in the middle market. We think it’s a less risky way to generate returns,” Fleischer said.
Investors in the new fund, which amassed more than its target of $1.5 billion, include the Arizona State retirement system, the Washington State Investment Board and the Canada Pension Plan Investment Board.
It has already used about a quarter of the fund to invest in two eye care companies and a craft brewery venture called Enjoy Beer, started by a former Harpoon Brewery chief executive.
This is the firm’s first fund since 2008, when it raised $1.5 billion. (Reporting by Liana B. Baker in New York; Editing by Andre Grenon)