DalFort Capital Partners Successfully Closes $166 Million Fund II Exceeding Expectations

DalFort Capital Partners Successfully Closes $166 Million Fund II

DalFort Capital Partners, an investment group based in Dallas, has recently announced the successful closing of its second fund, totaling $166 million, which significantly surpasses its intended hard cap. This achievement marks a significant milestone for the firm, which specializes in control investments in lower middle market industrial businesses.

Key Highlights of the Announcement

In addition to the successful fund close, the firm revealed its recent sale of Polymer Adhesives Holdings, LLC, based in Mineral Wells, Texas, to DiversiTech Corporation. This sale comes after DalFort made its initial investment in the company in May 2023. Polymer Adhesives is renowned for its high-performance duct sealants, adhesives, and fire-stopping materials and has expanded strategically under DalFort's partnership by acquiring two additional brands: Volunteer Adhesives and Fielco Adhesives. These acquisitions have broadened the company's product offerings and enhanced its manufacturing capabilities.

Bryan Bailey, the Managing Partner at DalFort, expressed his satisfaction with the accomplishments achieved with Polymer Adhesives, stating, "It was a privilege to partner with Brady Basil and the entire Polymer Adhesives team. We invested in a strong business with a clear growth trajectory, and the team executed on every front."

Significant Team Expansion

In line with its growth strategy, DalFort has also scaled its team, welcoming Marquez Bela as a Senior Partner. With nearly three decades of experience in middle-market investment, Bela has previously held roles at notable companies such as Rosewood Private Investments and Goldman Sachs. He highlighted DalFort's unique approach to the lower middle market: "What drew me to the firm is its differentiated approach, combining patient capital, deep operating expertise, and a genuine commitment to the businesses we partner with."

Details About Fund II

DalFort's Fund II has attracted $155 million from limited partners, alongside $11 million contributed by the general partner, which brings total commitments to $166 million. Notably, this capital influx was made possible by support from a diverse group of investors, including family offices, institutional investors, and individuals with a background in DalFort's target industries. The firm targets companies with EBITDA ranging from $3 million to $15 million and enterprise values between $15 million and $100 million.

Their investment strategy spans several sectors, including precision manufacturing, specialty chemicals, and industrial services, focusing on industries where operational expertise can generate durable value over time. Since its establishment in 2016, DalFort has engaged in seven platform investments and fourteen add-on acquisitions, collectively valued at over $250 million across five realized investments and three active platforms.

Future Directions

Looking ahead, DalFort remains committed to working with founders and business owners in the lower middle market industrial sector. Bryan Bailey emphasized the trust placed in the firm by its investors, stating, "As our firm grows, we remain committed to partnering with founders and business owners in the lower middle market industrial sector to drive exceptional results."

The recent exit from Polymer Adhesives, along with the significant team expansion and successful fundraising, positions DalFort Capital Partners to continue executing its mission vigorously. The firm appears poised for further growth, leveraging its operational expertise and strong relationships with business owners in its target markets.

DalFort's commitment to developing long-term partnerships highlights its dedication to building sustainable businesses and creating value in the lower middle market.

For more information about DalFort Capital Partners and their investment strategies, visit DalFort Capital.