Wednesday, 29 March 2017
Last updated 50 min ago
Oct 17 2016 | 9:31pm ET
Private equity firm Auxo Investment Partners has launched with an initial goal of raising $50 million in equity commitments to invest in North American manufacturing, industrial, value-added distribution, or business services companies.
Based in Grand Rapids, Michigan, the new firm was founded by Jeff Helminski, Jack Kolodny and Fred Tedori, according to information seen by FINalternatives. Helminski and Kolodny previously worked together as managing directors at Blackford Capital, where they collaborated with Tedori, an accomplished entrepreneur and private investor, on several investments.
The company has reportedly secured commitments for approximately half of its equity target, and is in discussions with additional founding partners. Auxo’s initial capital commitments will be combined with equity co-investments and modest leverage to acquire 10 to 15 companies over the next five years, the company said.
Investment criteria for these positions will include EBITDA of $1.5-$15 million and be either owner-operators seeking retirement or family succession planning solutions, or existing teams seeking to grow their businesses. Majority-control investments will be preferred, but the company will consider select minority-partner opportunities.
“We are partnering with investors who share our vision of a private-equity firm that invests in companies for the long term,” said Kolodny. “We’ve created a model that also allows them to share in the success of the firm, and in the long-term successes of our portfolio companies. We believe there is no private equity firm like it anywhere.”
Under Auxo’s model, founding partners are also investors in the firm itself. They participate in all economic benefits generated by Auxo, including carried interest and fees, with a priority position ahead of the management partners. A founding partner also serves as lead investor on the firm’s investment committee, the company said. In addition, former Michigan state treasurer and current Meijer Inc. vice chairman Mark Murray serves as a senior advisor to Auxo.
The new company, which takes its name from the ancient Greek goddess of growth, will utilize this flexible capital model to make long-term, growth-oriented decisions without setting artificial deadlines or predetermined timeframes for its investments, the firm said. Auxo will also adhere to the UN PRI, and will take ESG considerations into account when making investments.