Norwest Heads Southeast

Minneapolis-based Norwest Equity Partners has opened a second office in Florida. Tim DeVries, NEP’s managing partner, is spearheading the firm’s current growth phase and expansion into the Southeast.

The new NEP Florida office will be based in West Palm Beach in an office building currently under construction. Until occupancy in 2021, NEP is operating from temporary office space in Palm Beach.

NEP’s decision to open a second office, the firm has been operating out of Minneapolis since 1961, follows the recently announced additions of several new leaders at the firm, including Sundip Murthy, a partner who joined NEP in July from New York-based Snow Phipps; and Beth Lesniak, a managing director who joined NEP in September from Boulder-based Grey Mountain Partners. Both Mr. Murthy and Ms. Lesniak will operate out of the new Florida office, along with several other NEP team members.

“The Southeast has a robust and growing business climate, with middle-market companies that hold great potential for becoming leaders in their industries,” said Mr. Murthy.

In April 2015, NEP closed Norwest Equity Partners X LP, a $1.6 billion fund and Norwest Mezzanine Partners IV LP, an $800 million fund formed by NEP’s affiliated mezzanine investment firm, Norwest Mezzanine Partners.

NEP makes equity investments of $30 million to $250 million in companies that have more than $10 million in EBITDA. Sectors of interest include agriculture, business services, consumer, distribution, industrials, energy, and healthcare.

“The management teams at these companies deserve a partner that will work closely with them to build long-term value, not only during the investment period but for years to come,” said Mr. DeVries. “We hear from the leaders of our portfolio companies that NEP’s collaborative approach and respect for their vision, with a focus on supporting their strategy, scalability and performance, makes all the difference as they grow. For many of our companies and their founders, NEP is the first outside investor. We don’t underestimate the importance of our role and the experience these companies have with NEP.”

NEP has been actively investing in new portfolio companies including the June 2019 buy of Arteriors, a Dallas-based designer and supplier of lighting fixtures, furniture and accessories to residential and commercial interior designers and specialty retailers; and the October 2018 buy of Institute of Integrative Nutrition (IIN), a New York-based provider of professional health coaching certification programs. NEP is Arteriors and IIN’s first institutional investor.

NEP has also been active generating liquidity for its limited partners. In August, the firm sold a majority interest in GoHealth, a Chicago-based online provider of health insurance leads, to Centerbridge Partners (NEP has maintained a minority interest in GoHealth); in March 2019, NEP sold Actagro, a Freson, CA-based developer, manufacturer and marketer of soil and plant health products, to publicly-traded Nutrien for $340 million; and in November 2018 it sold Minnesota Rubber & Plastics, a Plymouth, MN-based contract manufacturer of rubber and thermoplastic components and assemblies, to KKR.

“The longevity of NEP in our industry, investing through so many cycles, translates to incredible knowledge and connections that benefit growing companies,” added Brian Allingham, a NEP partner and the firm’s chief operating officer.

Norwest Equity Partners was founded in 1961 as Northwest Growth Fund and was one of the first small business investment companies (SBICs) formed under the Small Business Investment Act of 1958. The firm’s first fund had capital of just $1.2 million. NEP is headquartered in Minneapolis.

© 2019 Private Equity Professional | October 22, 2019