Estancia Capital Management, a specialist private equity firm investing in lower middle-market financial services companies, has announced the successful final close of Estancia Capital Partners Fund III, L.P., securing $367 million in commitments against a target of $350 million. The oversubscribed close brings Estancia’s regulatory assets under management to approximately $965 million and marks the firm’s largest fund to date. Kirkland & Ellis served as legal advisor to the Estancia funds.
The fund received strong support from Estancia’s existing investor base of financial institutions, insurance companies, public pension funds, funds of funds, OCIOs, and family offices, alongside significant first-time commitments from new investors. The raise comes as Estancia continues to build on a track record that earned Estancia Capital Partners Fund II recognition by Bloomberg as one of the Top Ten Buyout Funds under $500 million for vintage years 2018 to 2023. To date, the Scottsdale and Philadelphia-based firm has invested in 17 platform companies, completed 21 add-on acquisitions, and executed nine complete exits and one partial exit.
Estancia focuses on lower middle-market companies that provide mission-critical solutions to the financial sector, partnering with founder- and operator-led businesses through management buyouts from larger financial firms, private ownership and succession transitions, growth initiatives, and team carve-outs. The firm said it targets less-penetrated niches within the financial industry where its decades of operating experience and deep domain expertise allow it to identify companies with outsized growth potential and durable business models.
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“This successful fundraise reflects the strength of the relationships we have built over many years and the trust our investors place in our ability to perform in a challenging market. We believe Estancia is distinguished by the breadth and experience of our team, together with deep domain expertise, which positions us well to pursue compelling opportunities in the lower middle market.”
Mike Mendez, Co-Founder and Managing Director, Estancia Capital Management
“Our decades of operating experience and investing in the financial services industry gives us distinctive insight about what contributes to great management teams and durable business models. We believe the lower middle market is less efficient, offering a broad opportunity set for us to repeatedly apply our investment strategy.”
Takashi Moriuchi, Co-Founder and Managing Director, Estancia Capital Management
