Sentinel Capital Seen Marketing Fund V in ’13

Sentinel Capital Partners is expected to begin fundraising for its next pool in early 2013, two placement sources say.

It’s unclear what size fund the New York-based private equity will be targeting. However, fundraising should be quick, one person says. “They’re a really strong performer,” the source says.

In 2008, Sentinel Capital raised $765 million with its fourth PE fund, nearly 28% more than its $600 million target. Sentinel Capital Partners IV LP has produced a 32.5% net IRR, according to Dec. 31 data from CalPERS.

Sentinel focuses on the lower middle market and targets companies with less than $35 million EBITDA for platform deals. Sectors include consumer, food/restaurants, healthcare and industrials. The firm will provide from $20 million to $90 million equity per deal although its sweet spot are investments ranging from $30 million to $70 million, according to the firm’s website.

The buyout shop has been busy exiting investments recently. Yesterday, Sentinel said it was selling Massage Envy, which provides massage therapy and facial treatments across the U.S., to Roark Capital. Sentinel acquired Massage Envy in January 2010. Sentinel, in July, also sold LTI Boyd, which makes custom engineered components. The investment dates back to 2006 when Sentinel recapped LTI Flexible Products.

Sentinel recently exited two investments that it made in 2007. Sentinel sold Inscape Publishing, which provides assessment and training products that develop interpersonal skills, to John Wiley & Sons in February in an $85 million deal. In November, Sentinel also sold Trinity Consultants to Gryphon Investors.

Sentinel has still been putting capital to work, however. In April, the PE firm acquired Colson Group, a producer of industrial casters, wheels, and hardware-related products. Sentinel bought Huddle House, a restaurant chain, that same month. In March, National Spine & Pain Centers, a Sentinel portfolio company, acquired Capital Spine & Pain Centers. Sentinel, in October 2011, bought WellSpring Pharmaceutical Corp., a North American maker and marketer of over-the-counter and specialty prescription pharmaceuticals.

A Sentinel spokesman declined comment.

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