com com David Carey David The by ... Another of the firm's hallmarks, Hirsch hallmarks, firm's the of Another Early on, New Mountain scored big New Mountain owns controlling Mountain New to Klinsky, According an investors charge will fund new The said, is to build a small, concentrated port- concentrated small, a build to is said, them." work "really folio of holdings and on a $115 million private investment in a Inc., Education Strayer in equity public post-sec- of operator Washington-based ondary schools for adults. New Moun- used to which Strayer tain's investment, pro- enrollment, boost and campuses add return. fivefold duced a roughly Another huge winner has been National Medical Health Card Systems Inc. New Mountain injected $80 million in the publicly of prescription traded, drug benefits manager in March. Its stake has more than doubled in value in the nine months since. stakes in three other companies: Apptis Inc., a provider of information technol- ogy services to the federal government; performs which Inc., Solutions Overland audits and property surveys for insur- ance companies; and Surgis Inc., which centers. surgery operates seeks promising sectors in which to in- indus- which say to declined he but vest, tries he and his eight partners are scop- ing out. annual equal to 2% of committed capital. New Mountain will earn a 20% , if, that is, it succeeds in delivering an 8% preferred to its limited partners. return AS FEATURED IN One investor grateful to have been in- been have to grateful investor One put "We New Mountain in what we To maintain its track record, New In its short life, New Mountain has New Mountain has had no losing in- equity means don't think private "We Institute of Technology's endowment. endowment. Institute of Technology's vited into the fold is Erik Hirsch, chief Ad- Lane Hamilton at officer investment visors, a consultant and fund manager. call the large market," Hirsch said. "That's above the traditional mid- dle-market firms [in size] and comfort- ably below the megafunds. There is a small group of elite fund managers in Moun- and Klinsky and New that space, of top the at They're them. of one are tain their game." cut Mountain off fundraising at $1.5 bil- lion, Klinsky said. able "We're to invest at high-qualityway a in and comfortably for bigger get to want didn't We size. this of getting bigger." the sake proved adept at choosing companies in high-growth top-grade sectors. Of- deal its into debt layering eschews it ten, structures if that would stunt a com- Klinsky said. growth, pany's vestments. parts nine put company, can tin a buy you debt to one part equity on it and try to squeeze out a return from financial en- Moun- New Instead, said. he gineering," "de- low-risk, calls he what out seeks tain wealth a with situations growth" fensive of upside potential.

2004 THE DEAL LLC.

Wrapping Wrapping up a wildly popular "It was unbelievable. We're talking Indeed, New Mountain's first, $770 private 17 the among first ranked That In addition to CalPERS, the second PRIVATE EQUITY PRIVATE DECEMBER 16, 2004 TUESDAY WEB DECEMBER PUBLISHED 16, 2004 TUESDAY ©

fundraising, New Mountain Capital LLC, Capital Mountain New fundraising, a 5-year-old middle-market private eq- uity firm led by Little ex-Forstmann & Co. partner Steven capped Klinsky, out its second investment fund at $1.55 bil- Deal. Daily lion, Klinsky told The But the fund could have been 3 that times size if institutional investors had had their way, Robertshaw, according a to John Boston managing Suisse director who helped First II raise Partners New Mountain LP. about $4 billion-plus in demand," said explaining that Robertshaw, marketing reputation Midas-like the given easy was has developed. Mountain New million fund, raised in 2000 and 2001, rate internal compound annual an sports of return of 28.2% through June 30, ac- Employ- Public California the to cording ees' Retirement System, the country's biggest public pension fund. equity funds raised in 2000 to which CalPERS pledged at least $100 million. The IRR outshines those of larger pools raised by such mainstays of the buyout Car- (18%), Group Pacific Texas as world lyle Group (18%), Hellman & Friedman LLC and (9.9%) Carson, Welsh, Ander- (4.6%). son & Stowe Elec- General the include investors fund's Massachusetts the and Trust Pension tric buyout buyout fund W closes Mountain New