Secretive Rhône comes back to market with Fund V

Rhône Group is back in the market with its fifth fund after closing its prior pool in 2011, according to three people with knowledge of the situation.

The target of Rhône Partners V is not clear. The firm’s prior fund raised about 1.13 billion euros ($1.3 billion), according to information from alternative assets data provider Bison.

Fund IV was generating a 1.18x multiple as of June 30, 2014, according to performance information from the Oregon Public Employees Retirement Fund.

[contextly_sidebar id=”9ej6Oj7hxcvB4OB0Yi1EClv6mtZse93Z”]Rhône is a highly secretive firm with offices in New York and London that focuses on European investments and trans-Atlantic opportunities. It targets investments in energy, materials, industrials, retail, consumer, healthcare and financial services, according to a description by Bloomberg Businessweek.

Unlike many other firms today, Rhone’s website consists of one page with a log-in for LPs and no other descriptions. A woman who answered the phone at Rhone’s New York office said the firm doesn’t talk to the media.

Earlier this year, Rhône partnered with Goldman Sachs to buy Neovia Logistics, which provides warehouse management and fulfillment, distribution and logistics services, from Platinum Equity. It also agreed to buy Global Knowledge, a provider of IT and business skills training, from MidOcean Partners.

Rhône also made a bid for beauty products company Elizabeth Arden Inc., which the company was reviewing as of August, according to a report in the Wall Street Journal. Rhône had earlier agreed to invest $50 million for a stake in the company, according to regulatory filings.

Rhône was founded in 1996 and as of Dec. 31, 2013, had about $4 billion under management. Earlier this year, the firm updated its regulatory filing with the U.S. SEC to include information about fees and expenses.

The update clarifies that Rhône may receive a fee in connection with the termination of a portfolio company monitoring agreement. It’s not clear if that monitoring agreement termination fee is the same as “accelerated monitoring fees” that have come under scrutiny this year. Under some private equity fund terms, portfolio company monitoring agreements that terminate before the end of their term get accelerated to full payment upon exit of the investment.

For example, under a 10 year monitoring agreement, even if the company is exited within five years, the firm would collect the full 10 year monitoring fee in an accelerated payment at the time of exit.

Rhône collects transaction fees and monitoring fees on investments and will occasionally use the proceeds to reduce management fees, according to the regulatory filing, known as a Form ADV.

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