Abbey National has sold its interest in the Hutton Collins Mezzanine Partners fund to US-based Capital Z Investment Partners. Hutton Collins set out to raise a €500m mezzanine fund almost two years ago. Capital Z will make a new commitment to the fund, which brings the current closed commitments to the fund from all investors to €200m.
Capital Z has purchased €35m of Abbey’s existing limited interests in the fund and has assumed from the group a minority interest in certain entities involved in the management of the fund.
The disposal is part of Abbey’s decision to sell its non-core assets and focus on retail offerings such as mortgages and savings. Last year the bank put its private equity interests up for sale. Most recently Abbey National Treasury Services signed a deal to sell around €700m leveraged loans to GE European Leveraged Finance Group.
Hutton Collins, as a debut mezzanine fund in tough fund raising conditions, has struggled to meet its initial target of €500m, but has managed to find investment opportunities for the funds is has raised. To date the fund has provided over €110m of mezzanine in support of four buyout deals; Coral, Télédiffusion de France, Pizza Express and Radio 538.
Graham Hutton said: “We’re delighted to announce this transaction, which both expands and strengthens the investor base of the fund?. given Capital Z’s extensive experience and ongoing commitment to the sponsorship of independent private equity firms, we consider that Capital Z is a perfect partner for us going forward.”