NORTH BRANCH CAPITAL MANAGEMENT, L.P.

Thesis

North Branch Capital Management, L.P. is a private equity firm founded in 2014, headquartered in Oak Brook, Illinois. The firm focuses on investing in lower middle market industrial businesses with strong growth potential, both organically and through add-on acquisitions. Their investment strategy centers on partnering with management teams in industrial businesses that exhibit engineering excellence or provide value-added services to solve complex customer problems. They specifically target companies in Value-Added Distribution, Niche Manufacturing, Industrial Services, and Industrial & Residential / Facility Services sectors. The firm prefers to invest in business-to-business companies with a moderate average order size, a complementary services or engineering component, non-commodity, highly engineered products, and low capital expenditure requirements. They also look for unique service offerings that generate consistent, repeatable revenue. Their geographic scope for platform investments is the United States and Canada, with a global reach for add-on acquisitions. North Branch Capital Fund I, established in 2019, secured $145 million in capital commitments. In July 2023, the firm announced the closing of its second fund, North Branch Capital Fund II, L.P. and North Branch Capital Fund II Select, L.P., which was oversubscribed and raised $213 million, exceeding its $200 million target. The firm's total Assets Under Management (AUM) was reported as $450 million as of a recent filing. For platform investments, North Branch Capital targets companies with revenues between $10 million and $75 million and EBITDA between $2 million and $8 million. For add-on acquisitions, the revenue range is $10 million to $100 million and EBITDA between $2 million and $10 million.

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