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Blackstone Raises $540M In Two Debt Funds

Firm: The Blackstone Group LP

Fund: GSO Private Investors II B LLC

Amount Raised: $252 million

Placement Agent: JPMorgan Securities LLC

Fund: GSO Private Investors Offshore II LP

Amount Raised: $288 million

Placement Agent: JPMorgan Securities LLC

The Blackstone Group LP has raised $540 million for credit strategies through a pair of new investment funds, regulatory filings showed. The firm has collected $252 million from 307 investors for GSO Private Investors II B LLC, while the other fund, GSO Private Investors Offshore II LP, has attracted $288 million from 281 investors.

Each pool has a $100,000 minimum investment, the filings showed. In neither filing did the firm indicate a target for the overall funds. JPMorgan Securities LLC is helping the firm raise both funds.

The New York mega-firm does much of its debt investing through Blackstone GSO Capital Partners, which the firm acquired in 2008 to be its leveraged finance arm. GSO was formed in 2004 by Bennett Goodman, along with  J. Albert (Tripp) Smith and Douglas I. Ostrover, a group of credit investors from Credit Suisse First Boston’s alternative capital arm. The trio launched their investment firm with a $1.5 billion fund that closed in July 2005. All three men became senior managing directors at Blackstone.

An earlier GSO vehicle, the 2007 vintage GSO Capital Opportunities Fund LP, has generated a 1.26x investment multiple and a 17.23 percent return for investor Teachers’ Retirement System City of New York. Other known investors include the North Carolina Department of State Treasurer, the State of New Jersey Division of Investment and the Wisconsin State Investment Board, according to the Thomson One private equity database.

The firm also is using the credit arm to push into public markets. In October, Blackstone raised up to $960 million for a publicly listed mutual fund, Blackstone/GSO Strategic Credit Fund, to invest in corporate credit whose quality is below investment grade, as sister news service Reuters reported at the time.

GSO has $55 billion under management, according to Blackstone Group’s Web site.

A spokeswoman for the firm declined to comment.