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Strategic, Adams Street invest in transport-focused funds – exclusive

The secondaries buyers made a stapled transaction, purchasing $109 million-worth of interests in Transportation Resource Partners III and also investing in Transportation Resource Partners IV.

Adams Street Partners and Strategic Partners have bought $109 million-worth of original commitments in Transportation Resource Partners III, two sources familiar with the matter have told Secondaries Investor.

The two buyers split the existing fund stakes roughly evenly, and the purchase was made at a discount, one of the sources said. Specific pricing for the transaction, which closed in May, was undisclosed.

Adams Street Partners and Strategic Partners bought the fund stakes from three undisclosed limited partners who wanted to exit the fund. Transportation Resource Partners III closed with about $250 million to $300 million in original commitments at the beginning of the global financial crisis.

One source mentioned that both Adams Street Partners and Strategic Partners made a stapled transaction and also invested in Transportation Resource Partners IV, which Transportation Resource Partners is currently raising. The firm recently held a first close on this fourth fund with about 50 percent of its $200 million target, the other source added.

In June, Strategic Partners also made a co-investment with Transportation Resource Partners in Endurance, a leading direct-to-consumer marketer, administrator and payment plan provider for vehicle service contracts.

Although the third fund was raised at the beginning of the financial crisis, most investments in the fund were made at the bottom of the market when valuations were quite low, one source noted, adding that current low oil prices also make the  sector an attractive space to invest in. “That provides additional cushion for these assets,” the source said.

Transportation Resource Partners makes investments in growth-oriented businesses in the transportation sector. The firm was started in 1997 by former race car driver Roger Penske as Penske Capital Partners. It closed its first fund under the Transportation Resource Partners name in 2004 with $265 million. Limited partners in that fund included Penske, GE Corporate Financial Services and Goldman Sachs, according to a statement announcing the new fund at the time. Transportation Resource Partners III was the successor fund to Transportation Resource Partners.

Transportation Resource Partners recently invested in 4Refuel, which provides mobile onsite refuelling, and in National Powersport Auctions, a wholesale auctioneer of powersport equipment it previously owned from 2006 and 2010.

Transportation Resource Partners didn’t return a request for comment. Strategic Partners and Adams Street Partners declined to comment.