LONDON, April 5 (Reuters) - Credit fund manager Park Square Capital has closed a new 850 million euro ($1.2 billion) fund, Park Square II, targeted at mezzanine loan investments, having kicked off the fund at the height of the credit crisis.
The new fund has been raised from investors in Europe, Asia and North America, with pension funds, insurance companies and sovereign wealth funds making up 80 percent of the capital commitments, Park Square said.
Park Square started fund-raising in September 2008, a week after the collapse of U.S. investment bank Lehman Brothers, and the fund had its first closing in December 2009, Park Square's managing partner Robin Doumar and partner Brandon Bradkin told Thomson Reuters LPC.
"It's been a particularly challenging environment, but we have a very blue-chip investor base, some of the highest quality and smartest pension funds, insurance companies and sovereign wealth funds," Doumar said.
Park Square said the new fund would be able to provide financing to private equity firms making medium-sized and larger acquisitions.
It is expected to generate returns by making mezzanine loan investments in companies with leading market positions, stable and predictable cashflows and experienced management teams.
Mezzanine loan volume has fallen since September 2008 in line with the wider leveraged loan market. Only 105 million euros of mezzanine loans were completed in the first quarter of 2011, compared with 702 million euros in the fourth quarter, according to Thomson Reuters LPC data, but Park Square remains upbeat on volumes.
"We have made seven investments so far in the fund, so it's about 30 percent invested," Bradkin said. "We are as busy now as we have been for some time. There is new activity that's pending in the market. We are optimistic about the prospects for mezzanine," he added.
In February this year, U.S. private equity firm Bain Capital's buyout of Dutch specialty chemicals distributor IMCD included 35 million euros of mezzanine loans, while Bain also obtained 300 million pounds ($483.5 million) of mezzanine loans for its buyout of RBS WorldPay, a payment card processing business.
Park Square Capital, which was established in 2004, has invested more than 2 billion euros in 34 mezzanine investments, more than 500 million euros in senior debt and approximately 500 million euros in special situations, it said.
In June last year Park Square, along with Apollo Management [APOLO.UL], Cerberus [CBS.UL] and York Capital Management, took control of UK bingo operator Gala Coral by swapping 558 million pounds of mezzanine loans for equity in the company and injecting 200 million pounds of cash to repay senior ranking loans. ($1=.7050 EURO) ($1=.6204 POUND)
Source: www.reuters.com
The new fund has been raised from investors in Europe, Asia and North America, with pension funds, insurance companies and sovereign wealth funds making up 80 percent of the capital commitments, Park Square said.
Park Square started fund-raising in September 2008, a week after the collapse of U.S. investment bank Lehman Brothers, and the fund had its first closing in December 2009, Park Square's managing partner Robin Doumar and partner Brandon Bradkin told Thomson Reuters LPC.
"It's been a particularly challenging environment, but we have a very blue-chip investor base, some of the highest quality and smartest pension funds, insurance companies and sovereign wealth funds," Doumar said.
Park Square said the new fund would be able to provide financing to private equity firms making medium-sized and larger acquisitions.
It is expected to generate returns by making mezzanine loan investments in companies with leading market positions, stable and predictable cashflows and experienced management teams.
Mezzanine loan volume has fallen since September 2008 in line with the wider leveraged loan market. Only 105 million euros of mezzanine loans were completed in the first quarter of 2011, compared with 702 million euros in the fourth quarter, according to Thomson Reuters LPC data, but Park Square remains upbeat on volumes.
"We have made seven investments so far in the fund, so it's about 30 percent invested," Bradkin said. "We are as busy now as we have been for some time. There is new activity that's pending in the market. We are optimistic about the prospects for mezzanine," he added.
In February this year, U.S. private equity firm Bain Capital's buyout of Dutch specialty chemicals distributor IMCD included 35 million euros of mezzanine loans, while Bain also obtained 300 million pounds ($483.5 million) of mezzanine loans for its buyout of RBS WorldPay, a payment card processing business.
Park Square Capital, which was established in 2004, has invested more than 2 billion euros in 34 mezzanine investments, more than 500 million euros in senior debt and approximately 500 million euros in special situations, it said.
In June last year Park Square, along with Apollo Management [APOLO.UL], Cerberus [CBS.UL] and York Capital Management, took control of UK bingo operator Gala Coral by swapping 558 million pounds of mezzanine loans for equity in the company and injecting 200 million pounds of cash to repay senior ranking loans. ($1=.7050 EURO) ($1=.6204 POUND)
Source: www.reuters.com
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