Platinum closes fifth fund on $10bn hard-cap

The vehicle was announced in March 2019 and held a first close in July 2019 on $7.2bn, followed by an interim close in November 2019 on $9.356bn.

Simpson Thacher & Bartlett advised on the fund formation. The fund is registered in Delaware and follows market standard terms and conditions. Mark Barnhill, partner at Platinum, led the fundraise.

The GP's previous vehicle, Platinum Equity Capital Partners IV, held its final close in March 2017 on $6.5bn. The Delaware-headquartered vehicle exceeded its target of $5.5m.

Investors
The fund drew commitments from more than 250 institutional investors in 30 countries. According to Unquote Data, both Indiana Public Retirement System (INPRS) and Pennsylvania Public School Employees Retirement System (PSERS) each committed $300m to the vehicle. The GP commitment was approximately $1bn.

Partner Mark Barnhill told Unquote that the LP base includes a range of institutional investors, including sovereign wealth funds, public and private pension funds, and family offices. The fund saw a 95% re-up rate from its predecessor vehicle, according to Barnhill.

LPs in Platinum's predecessor fund included US-based pension funds, as well as Nordic-based insurance companies. It also received a $300m commitment from PSERS.

Investments
The GP said in a statement that the vehicle will follow a similar strategy to its predecessors. The fund will focus on companies in North America, but will also invest in Europe and Asia. It aims to make 20-30 majority-stake investments in companies with enterprise values of up to $4bn, targeting turnarounds and special situations, including corporate spin-outs from Fortune 500 companies and bankruptcy-related reorganisations. The fund will also invest in take-privates.

Barnhill told Unquote that the fund will not focus on particular sectors and will instead focus on business dynamics, seeking businesses that may be underperforming operationally or undergoing technology-related transitions. Barnhill said the GP aims to provide operations assistance and create market leaders.

The vehicle expects to hold a company for three to five years. It will write equity cheques of up to $1bn. A maximum 20% of the fund can be dedicated to a single investment. According to Barnhill, the fund has two current investments in its pipeline.

People
Platinum Equity Capital Partners – Mark Barnhill (partner).

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