New Mountain Capital has officially wrapped up fundraising for its second non-control private equity fund, New Mountain Strategic Equity Fund II (SEF II), securing a total of $1.2 billion. This fund focuses on making partnership-oriented minority investments rather than acquiring controlling stakes, continuing the firm’s emphasis on defensive growth industries and business-building strategies.
SEF II is designed to pursue investments in specific sectors known for non-cyclical growth patterns. These include infrastructure services, life sciences and advanced materials, healthcare technologies, advanced data and analytics, software, financial and insurance services, and technology-enabled business services. By concentrating on these areas, the fund seeks to capitalize on opportunities where market demand remains resilient even in uncertain economic conditions.
The fund's non-control approach involves acquiring minority stakes that enable New Mountain Capital to partner closely with management teams to drive growth while allowing the existing leadership to retain control. This strategy reflects the firm's research-intensive underwriting process, focusing on industries where long-term growth prospects and stability are attainable.
Adam Weinstein, New Mountain Capital’s managing director, president, and chief operating officer, noted the firm’s consistent commitment to its core principles. He highlighted the importance of deep research and underwriting, combined with a growing team to support business-building and value creation. These elements remain central to both the firm’s control and non-control investment strategies.
Investor interest in SEF II was strong enough to push the fund beyond its established "hard cap" of $1 billion. In addition to the substantial commitments from external investors, the general partners contributed more than $150 million, aligning their interests directly with those of the limited partners. The fund’s clientele includes a diverse group of investors such as pension funds, insurance companies, asset managers, endowments, family offices, registered investment advisers (RIAs), and high-net-worth individuals, indicating broad-based confidence in the fund's investment thesis and strategy.
Prior to its final close, SEF II had already made an investment in Wipfi LLP, a provider of accounting, tax, and advisory services. This move reflects New Mountain Capital’s familiarity with the accounting sector, as earlier private equity funds—specifically the sixth and seventh—invested in entities like Citrin Cooperman Advisors and Grant Thornton LLP.
Legal counsel for the fund was provided by Simpson Thacher and Bartlett, a detail that underscores the firm’s attention to legal and regulatory aspects in structuring its investments.
By comparison, New Mountain Capital’s initial strategic equity fund, SEF I, closed in 2020 with commitments of approximately $640 million. The current fund, therefore, represents a near doubling in capital raised, signaling strong momentum and investor trust in the firm’s strategy and execution capabilities.
New Mountain Capital manages a diverse portfolio with assets under management totaling approximately $60 billion. Its investment vehicles cover private equity, strategic equity, credit, and net lease real estate funds. The firm’s workforce comprises over 300 professionals, which supports its extensive research capabilities and hands-on involvement in portfolio companies.
New Mountain Finance Corp (NYSE: NMFC), the publicly traded affiliate involved with managing some of these investment assets, has recently seen its stock price trade at lower levels, reflecting the market’s current valuation of its underlying investments and capital position. Nonetheless, the firm's strong fundraising efforts and investment discipline exemplify its ongoing commitment to growth through non-cyclical business opportunities.