Peterson raises $510 million to keep Draper's Kelso Industries

DRAPER — Peterson Partners has closed a capital raise of $510 million for Peterson Kelso Coinvest, LP, a single-asset continuation vehicle built around Kelso Industries, the Draper-based mechanical, electrical and plumbing contractor it has backed since 2021. The firm announced the close on Sept. 9 1. Peterson's own news page carries the same announcement 3.

NorthSands Capital, a New York firm that invests in single-asset continuation vehicles, was the sole lead investor and committed more than $450 million, according to the announcement 1. Peterson Partners Fund X, the firm's current flagship private equity fund, rolled its existing position into the new vehicle and made an additional investment 1. Utah Business reported that the deal restructures how Peterson holds its stake in Kelso rather than selling the company 2.

The $510 million is the amount raised for the vehicle. The announcement states no purchase price and no valuation for Kelso 1. A continuation vehicle lets a private equity sponsor keep a portfolio company for longer while giving existing limited partners the option to cash out or roll forward 2. Utah Business reported that GP-led continuation vehicle volume reached a record $106 billion in 2025, roughly a 51 percent increase on the prior year 2.

The proceeds will support Kelso's growth through acquisitions, investment in people and capabilities and expansion into new markets, the announcement says; it names no acquisition targets or timelines 1.

Kelso was founded in 2021 through Peterson's partnership with co-founders Steve Carroll and Steve Nicholson and is headquartered in Draper 1. The company says it operates in more than 40 states with more than 4,000 employees, serving commercial, institutional and industrial customers including data centers, healthcare facilities, airports, industrial sites and advanced manufacturing, and that its model lets acquired companies keep their local culture and operating autonomy while drawing on a national organization 1. Utah Business reported that Kelso passed $1 billion in annual revenue with 31 completed acquisitions as of October 2025, up from a single Arizona contractor doing $17 million in revenue that Carroll acquired the year Kelso launched, and that Kelso was one of three initial investments of Peterson's $265 million Fund X when that fund closed in May 2024 2.

"Steve Carroll and Steve Nicholson have built an outstanding business focused on serving some of the most demanding customers and project types in the country," Spencer Clawson, a partner at Peterson Partners, said in the announcement. "We believe the Company remains in the early innings of a significant opportunity" 1. Bruce McEvoy, managing partner of NorthSands Capital, said Kelso has established itself as "one of the most compelling platforms in the MEP services sector" 1. Carroll and Nicholson said in the same announcement that building Kelso from the ground up "has been the opportunity of a lifetime" 1.

Peterson Partners reports approximately $3.0 billion under management and investments in more than 300 companies 1. NorthSands was founded in 2023 by Bruce McEvoy, a former senior managing director in Blackstone's private equity business 1. Jefferies LLC served as exclusive financial advisor to Peterson; Mayer Brown and Honigman LLP were legal counsel to Peterson and Kelso; Kirkland & Ellis LLP advised NorthSands 1.