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AEA Private Equity Fund

With offices in New York, London, Munich, Hong Kong and Shanghai, and with 20 senior investment professionals leading a staff of approximately 30 professionals overall, AEA leverages its experience, global network, and resources across continents, industries, and capital markets. AEA's middle market private equity team currently manages over approximately $3.6 billion of invested and committed capital. The firm operates as a single global private equity organization focusing on buying businesses headquartered in the U.S. and Europe (and selectively in Asia). Unlike country-specific or regional funds, AEA applies its institutional knowledge and experience, as well as the resources of its investment professionals and Participants, on a worldwide basis in support of its investment activities. AEA believes that during a period of increasing globalization, its worldwide network of relationships-including Participants, operating partners, portfolio companies, and the AEA investment team-enables the firm to be an invaluable resource in helping our investors and our companies profit from those changes.

AEA today focuses on well-defined sectors:

- Value-added industrial (including manufacturing, service, and distribution)
- Specialty chemicals
- Consumer products
- Services (primarily to these sectors)

Focusing teams on specific sectors magnifies the AEA structure and network. AEA’s deep industry knowledge and rigorous due diligence enable the firm to identify attractive assets with the potential to generate superior investment returns.

In the industrial products and specialty chemicals sectors, AEA primarily looks for companies that have high value-added margins, strong and defensible market positions in attractive niches, and opportunities to grow both organically and through accretive strategic acquisitions. Such companies often have proprietary technology, meaningful switching costs for customers, strong distribution relationships, and sustainable product innovation capabilities. While they are already well-positioned, attractive businesses, such companies are likely to offer opportunities for AEA in partnership with management to accelerate revenue growth, focus operations, and improve financial management.

In consumer products, the AEA investment team focuses primarily on branded food, beverage, personal care, and household product companies. In addition, AEA is pursuing investment opportunities among manufacturers of private label products in certain categories, selected semidurable goods manufacturers, and service providers in the consumer goods sector. That investment focus is derived from AEA’s belief that the changing retail environment, which is causing both traditional retailers and consumer packaged-goods companies to adopt new strategies, will result in attractive investment opportunities. In order to be able to identify and capitalize on those opportunities, an understanding of key trends in demographics and consumer behavior, retail channels and retailers, and, more broadly, sales, marketing, and operational/manufacturing strategies is necessary. With that requisite knowledge, in addition to an extensive network of executives, advisers, and Participants, AEA is well positioned for success.

In the services sector, AEA seeks to make investments in distribution, outsourcing and retail services companies that deliver essential, value-added solutions to their clients. Services companies that AEA focuses on are typically noncyclical businesses that have recurring customer relationships, generate highly predictable earnings, and deliver high returns on invested capital.


AEA Private Debt Funds

AEA Mezzanine Funds

In 2005, AEA raised the $600 million AEA Mezzanine Fund to pursue mezzanine debt investments in middle market companies. In 2008, AEA had a first closing on AEA Mezzanine Fund II. Combined, the Mezzanine Funds have approximately $900 million of capital under management. AEA views mezzanine debt investing as highly complementary to its private equity investing, and allows the firm the capability to provide both debt and equity capital to middle market companies and management teams. The Mezzanine Funds evaluate potential investments in a broad range of industries and have developed a diverse portfolio by investing in partnership with AEA’s private equity professionals as well as other private equity sponsors and in “unsponsored” public and private companies. The Mezzanine Funds invest in a broad range of transactions, including acquisitions, recapitalizations, refinancings and growth opportunities. In addition, the Mezzanine Funds also make equity co-investments. The target size ranges for the Mezzanine Fund’s investments are $10 million to $40 million for mezzanine debt and $1 million to $5 million for equity co-investments. Since its formation in 2005, the AEA Mezzanine Fund has invested in over 30 different companies. This team is based in Stamford, Connecticut and New York.

AEA Middle Market Debt Fund

In 2007, AEA formed the AEA Middle Market Debt Fund to pursue senior secured debt investment opportunities in middle market companies. The Middle Market Debt Fund has over $300 million of capital under management. AEA views senior debt investing as highly complementary to its private equity and mezzanine debt investing, and allows the firm the capability to provide first and second lien senior secured debt, mezzanine debt and equity capital to middle market companies and management teams. The Middle Market Debt Fund makes investments in a broad range of industries and has developed a diverse portfolio of investments by investing in partnership with AEA’s private equity professionals as well as other private equity sponsors and in “unsponsored” public and private companies. The Middle Market Debt Fund has invested in a broad range of transactions, including acquisitions, recapitalizations, refinancings and growth opportunities. In addition, the Middle Market Debt Fund makes equity co-investments in certain transactions. The target size ranges for the Middle Market Debt Fund’s investments are $5 million to $15 million for senior secured debt and $250,000 to $1 million for equity co-investments. Since its formation in 2007, the Middle Market Debt Fund has invested in over 40 different companies. This team is based in Stamford, Connecticut and New York.

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AEA Small Business Fund

In 2004, AEA formed AEA Small Business Fund as its principal investment vehicle for pursuing leveraged buyout investment opportunities in the United States small business market. The Small Business Fund has $285 million of capital under management. The Small Business Fund’s investment approach and sector focus mirrors that of AEA, except it targets transaction values smaller than the AEA Private Equity Fund. The Small Business Fund is integrated with the AEA Private Equity Fund, providing it with access to specific industry and transaction knowledge, networks of industry executives and other influential market participants, due diligence resources and deal execution experience.

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