Babson Capital, the UK leveraged loan manager and Duke Street CDO spin-out, has closed Almack Mezzanine I, Europe’s first dedicated mezzanine fund, on €800m.
Following a first close in November 2005 at €251m, the investment strategy will see Almack target both large and mid-market mezzanine investments in the UK and Continental Europe. The fund has already invested €348m since its launch in 2005, and according to Babson has a strong pipeline for Q3 2006. The fund has been structured as a parallel leveraged and unleveraged structure to provide flexibility to investors. There are 16 investors in the fund, including insurance companies, fund-of-funds investors, international banks and pension funds.
David Wilmot, managing director of Babson Capital Europe, commented: “Almack I has provided us with the capacity to increase our activities in the large-cap mezzanine arena, whilst enabling us to arrange subordinated debt tranches on mid-market deals for our private equity sponsor relationships. The fund represents a major deal origination initiative for us in Europe, which has significantly strengthened our market position.”
Babson Capital Europe has been investing in the European mezzanine market since 2001, and the mezzanine team led by David Wilmot and Adam Eifion-Jones. Babson Capital Europe was set up in 2000 as Duke Street Capital Debt Management, part of Duke Street Capital. Babson Capital Europe was acquired by Babson Capital Management in May 2004 and was renamed Babson Capital Europe Limited in September 2004.