AEA Investors mezz fund closes at $575 mln

Firm: AEA Investors LP

Fund: AEA Mezzanine Fund III

Amount raised: $575 million

Placement Agent: Equus Financial Consulting LLC

AEA Investors listed about $518 million raised for the fund on a Form D filing, but that figure doesn’t include foreign limited partners or the commitment from the general partner, according to a source. The firm held a final close on the fund on March 14.

The success by AEA comes despite a drop in commitments to mezzanine funds to $794 million in the first quarter, from $1.73 billion in the year-ago period, according to figures compiled by Buyouts. One possible factor in this drop could be low interest rates, which have made lower-cost senior and unitranche debt more popular for borrowers and higher-cost mezzanine debt less desirable. However, if interest rates rise, mezzanine debt could become more attractive.

Joseph Carrabino Jr., a managing director at AEA Investors, is listed as a the executive officer and promoter of AEA Mezzanine Fund III, according to a Form D filing with regulators.

Carrabino joined AEA in 2004 to lead its mezzanine investing effort focused on the middle market, according to his biography on the AEA Investors website.

Carrabino spent four years at Whitney & Co. as co-head of the mezzanine debt group and member of the credit and investment committees, where he managed $1 billion of dedicated capital. He also spent 12 years at Credit Suisse in leveraged finance and financial sponsor coverage, high yield finance and corporate restructurings and reorganizations.  

AEA Investors raised about $600 million for the vintage 2005 AEA Mezzanine Partners LP, followed by the vintage 2009 AEA Mezzanine Fund II, according to the Thomson One private equity database.