Kainos Capital LP closed its third fund with over $1 billion in capital commitments, making it the largest fund raised in the Dallas private equity firm’s history.
Investors included the CPP Investment Board which invested $100 million in the fund in 2021. According to the approximately $2 billion firm, existing Kainos investors represented a significant portion of Kainos Capital Partners III’s capital.
The strategy is focused on food and consumer companies, where the team leverages its industry experience and relationships to help portfolio businesses capitalize on growth opportunities and improve profitability. The partners at the firm have been investing in the sector for more than two decades. This includes Founder Andrew Rosen, who established and lead the U.S. food and consumer products group at Hicks, Muse, Tate and Furst.
“Our bench of seasoned investors and operators within the food and consumer sectors helps drive financial and operational performance by working hand-in-glove with management teams,” said Rosen. “We believe Kainos’ sector experience, industry relationships, and robust operating capabilities make us an attractive partner to families and entrepreneurs who are excited about their business’ prospects yet seek to diversify their wealth.”
Kainos’ Operations Team works directly with portfolio companies to help drive manufacturing process improvement, supply chain and purchasing savings, financial organization and analysis, information technology enhancements and talent recruitment and retention. The firm also owns a controlling ownership stake in MEMCO Engineering Solutions, a company that designs and implements customized, automated food and beverage manufacturing production systems.
The focus of Fund III is family-owned businesses and corporate carve-outs with at least $10 million in EBITDA. The fund is able to commit more than $300 million of equity and potentially more via its LP co-investment program.
Fund III to date is approximately one-third invested across three platform acquisitions: CellCore Biosciences, a wellness company that provides dietary supplements that are primarily sold through the practitioner channel; Specialty Sales, a specialty dairy cow health distribution business; and Evriholder Products, a provider of impulse products and merchandising solutions for retailers.
Fund II’s portfolio currently includes Wellful (portfolio of health and wellness brands including Nutrisystem, Nugenix and Super Beta Prostate), Whisps (cheese snacks), Muenster (pet food), and BeautyBio (skincare products). Previously exited portfolio companies include: Kettle Cuisine (soup and meal solutions); Ferraro Foods (specialty foodservice distribution); Olde Thompson (private label spices); good2grow (children’s beverages); SlimFast (weight management products); Country Fresh (fresh produce supplier); Florida Foods (specialty clean ingredients) and Trilliant (coffee products).
