Bain Sets $250M-$300M Goal For CLO Fund

Firm: Bain Capital Partners LLC

Fund: Sankaty CLO Partners LP

Target: $250 million to $300 million

Amount Raised: $166 million

Placement Agent: None

The Boston-based firm has raised $166 million from 23 investors for Sankaty CLO Partners LP, according to a regulatory filing on April 24, and it expects to close the fund in the second half of this year in the range of $250 million to $300 million, the person said.

The new fund will have a three-year investment period, during which it will be able to reinvest money that is returned from its portfolio, the person said. After that, proceeds will be returned to investors.

CLOs are bundles of commercial loans, stratified into tranches with varying levels of risk and return, that are themselves sold to credit investors. Nearly half of CLO holdings are leveraged loans, according to sister service Thomson Reuters Loan Pricing Corp.

Sankaty has been active in the CLO market, having issued at least five CLO vehicles since November 2011. The firm also manages existing CLOs and buys and sells the instruments in the secondary market. In the past, it has financed its commitments through Bain Capital’s general purpose funds. Existing CLO holdings in other fund structures will be unaffected by the new fund.

Sankaty also pursues other strategies in the credit market. Last June, the firm raised $3.5 billion for a pair of credit opportunity funds.

Known backers of Bain Capital efforts include the California State Teachers’ Retirement System, Pennsylvania State Employees’ Retirement System, the San Francisco City and County Retirement System and the South Carolina Retirement Systems, according to the Thomson One private equity database.