Crossroads FoF crosses two-thirds mark

Lehman Brothers is running out of space in its latest fund of funds, suggesting a successor may be just around the corner.

The New York-based firm, which closed on $1.5 billion for its Lehman Brothers Crossroads Fund XVIII earlier this year, has committed more than $1 billion to 50 funds, including the latest investment vehicles of The Carlyle Group, Doughty Hanson & Co., First Reserve Corp. and Oaktree Capital Management. About 20%, or $300 million, of the fund is reserved for co-investments.

The fund is allocated to four classes of general partnerships: 30% to large buyout funds, 30% to mid-sized buyout funds, 20% to special situations, distressed and turnaround funds, and 20% to venture capital. The allotment reserved for co-investments is the least depleted bucket in the fund, although a spokesman would not specify how much remains.

Lehman Brothers began raising Crossroads XVIII a year ago, aiming for $750 million with no hard cap. Employees of the investment bank pledged $130 million of their own money to the fund, according to the firm. Lehman acquired Dallas-based funds of funds manager Crossroads Group in 2003. Its previous fund of funds closed at $644 million in 2005.

In related news, last month Lehman said it planned to raise a $500 million fund of funds through an IPO on Amsterdam’s Euronext exchange. That vehicle, due to go public IPO later this year, is earmarked for private equity funds and direct investments. —Mark Cecil