Stephen Murray the former CEO of CCMP Capital died recently. CCMP Capital had formerly been JPMorgan Partner’s team that handled buyouts and growth equity. After it was spun out from JPMorgan Partners in 2006, the first committed capital it received was an independent fund with $3.4 billion. Prior to getting the money there naturally were questions about the company’s track record, their reliance on the bank and how the company would source deals. Still, the fundraising process was very successful because of CCMP Capital’s track record of successful execution and good strategy.
The company initially debated whether they should seek $3.25 or $3.5 billion in funding. Even though they decided on $3.5 billion, their fund raising efforts only generated $3.25 billion because they didn’t have enough time to secure the additional funding. They received 80% of their capital funding in that round from outside investors whereas in the past the bank provided 80% of their funding. This shows CCMP Capital had to develop a large number of new quality relationships. The company felt good about their new limited partners as well as the new investment team it created.
Read more: Former CCMP CEO Stephen Murray Dies at 52
Stephen Murray officially took over as president and CEO from Jeffrey Walker in January or February 2007. The company did not issues a press release then because the new titles reflected the way the company had been run for years. Walker was focused on high-level relationships and strategy while Murray handled investment origination and execution. They worked together, along with six of their partners, on the investment committee.
There have been some changes in investment strategy since CCMP left JPMorgan Partners to become and independents company, Murray explained at the time. JPMorgan Partner’s traditional investment structure was marked by broad diversification. It had multiple asset classes as well as a broad geographic footprint. When CCMP Capital was part of JPMorgan Partners the average size of their investments was about $25 million. When it became an independent company, CCMP Capital then had an average investment size of $200 million.
The increase in the size of the average investment resulted from eliminating some of the venture capital, mezzanine and Latin American investments from the new company’s portfolio. Eliminating co-invests and a number of other similar types of investments also played a role. The focus of CCMP Capital then became wanting to take the lead on deals where they managed the process from beginning to end.
Read more from Stephen Murray on Institutional Investor