Thomas H. Lee Partners

Thomas H. Lee Partners, L.P. is an American private equity firm based in Boston, Massachusetts specializing in leveraged buyouts, growth capital, special situations, industry consolidations, and recapitalizations.[2]

This article is about the private equity firm. For private equity investor, see Thomas H. Lee (businessman).
See also: Lee Equity Partners
Thomas H. Lee Partners, L.P.
TypePrivate Limited partnership
IndustryPrivate equity
Founded1974 (1974)
FounderThomas H. Lee
Headquarters100 Federal Street
Boston, Massachusetts, United States
ProductsLeveraged buyout, growth capital
AUM$10 billion[1]
Number of employees
50+ (2007)
Websitewww.thl.com

History

Founded in 1974 by its namesake Thomas H. Lee, Thomas H. Lee Partners, often referenced as THL or THL Partners[3] has raised approximately $22 billion of equity capital, investing in more than 100 businesses with an aggregate purchase price of more than $150 billion, completing over 200 add-on acquisitions. In 2012, Private Equity International ranked THL Partners 22nd of the top 300 private equity firms based on funds raised.[4]

Thomas H. Lee Partners’ team includes 21 senior partners led by Anthony DiNovi and Scott M. Sperling, who became co-presidents of the firm in 1999. The firm's namesake, Thomas H. Lee, left the firm and formed Lee Equity Partners in 2006.[5]

Investments

The firm has raised $22 billion since inception and is currently investing out of its $2.6 billion seventh fund:

  • 1984 - Fund I($66 million)
  • 1989 - Fund II ($568 million)
  • 1996 - Fund III ($1.4 billion)
  • 1998 - Fund IV ($3.5 billion)
  • 2001 - Fund V ($6.1 billion)
  • 2006 - Fund VI ($8.1 billion)
  • 2015 - Fund VII ($2.6 billion)

Source: Thomas H. Lee website

An eighth fund is being raised, targeting $3 billion.

Thomas H. Lee Partners invests in growth-oriented companies within three broad sectors: Business & Financial Services, Consumer & Healthcare, and Media & Information Services. The firm seeks acquisition candidates with opportunities for sustainable growth in their core and/or related businesses that are positioned to capitalize on key competitive advantages to increase market share, expand distribution or product lines and participate in industry consolidation.

Notable transactions sponsored by THL include Aramark,[6] Conseco,[7] Ceridian,[8] Dunkin' Brands,[9] Experian, Fidelity National Information Services, HomeSide Lending, Houghton Mifflin,[10] inVentiv Health,[11] Michael Foods,[12] The Nielsen Company, ProSiebenSat.1, Snapple,[13] Warner Chilcott,[14] Warner Music Group[15] and West Corporation.[16]

Thomas H. Lee Partners' most recent fund has performed well, according to CalPERS.[17]

Controversies

Thomas H. Lee Partners is also known for its leveraged buyout acquisition in 2004 of Refco, a financial services company specializing in commodities and futures contracts, which collapsed suddenly in October 2005, only months after its IPO. Refco's collapse cost investors more than $1 billion sparking multiple suits for negligence against the firm. Thomas H. Lee Partners in turn sued Refco's auditors and former executives claiming they hid the fraud which caused Refco's collapse.[18] Thomas H. Lee Partners has since settled all claims by Refco’s brokerage customers, bankruptcy trustee and shareholders.[19]

Affiliates

Thomas H. Lee Partners’ affiliates include:

THL Credit Advisors provides junior debt and equity to middle-market companies seeking capital for growth, acquisition, recapitalization and/or change of control.[20]

TH Lee Putnam Ventures is a technology-focused private equity firm affiliated with Thomas H. Lee Partners and Putnam Investments, a leading global money management firm. TH Lee Putnam Ventures manages $1.1 billion in capital commitments and has invested approximately $850 million in more than 43 companies since the firm's formation in 1999.[21]

Notes
  1. PEI 300 - Top 50, Private Equity International, May 2012.
  2. "Thomas H. Lee Partners, L.P.: Private Company Information - Businessweek". investing.businessweek.com. Retrieved 13 August 2012.
  3. Thomas H. Lee forms new venture: Lee Equity Partners (MarketWatch, 2006)
  4. Private Equity International, 2012
  5. Thomas H. Lee forms new venture: Lee Equity Partners (MarketWatch, 2006)
  6. Press Release
  7. Thomas H. Lee And trouble, Forbes, November 17, 2005.
  8. Thomas H. Lee Partners and Fidelity National Financial Complete Acquisition of Ceridian
  9. Parent of Dunkin' Donuts Sold For $2.4 Billion to Equity Firms (New York Times, 2005
  10. Vivendi Confirms Houghton Mifflin Sale,(New York Times, 2002)
  11. inVentiv Health to be taken private in deal with Thomas H. Lee Partners(Columbus Business First, 2010)
  12. Michael FoodsMichael Foods To Be Bought For $1 Billion (New York Times, 2003)
  13. Thomas H. Lee In Snapple Deal (New York Times, 1992)
  14. Press Release: Warner Chilcott Acquired for $3.1 Billion
  15. Press release: Investor Group Led by Thomas H. Lee Partners, Edgar Bronfman, Jr., Bain Capital and Providence Equity Partners to Purchase Warner Music Group and Create one of the World's Largest Independent Music Companies
  16. Press release: Recapitalization of West Corporation by an Investor Group Led by Thomas H. Lee Partners and Quadrangle Group
  17. CalPERS private equity investments Archived 2012-04-19 at the Wayback Machine
  18. Refco bankruptcy trustee sues Thomas H. Lee Partners, New York Times, August 9, 2007.
  19. Thomas H. Lee Reaches $145 Million Settlement with Refco Trustee and Brokerage Customers (American Lawyer, 2011)
  20. THL Credit. THL Credit (2013-06-30). Retrieved on 2013-08-16.
  21. TH Lee. Thlpv.com. Retrieved on 2013-08-16.
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