Ex-TPG credit affiliate closes Castlelake III at $1.4 bln hard cap

Firm: Castlelake LP

Fund: Castlelake III LP

Target: $1 billion

Amount raised: $1.4 billion, hard cap

Placement Agent: Denning & Company LLC

Castlelake will continue to focus on European non-performing loans, global aviation, U.S. distressed asset opportunities (including commercial and industrial loans), small balance commercial real estate loans, residential land, as well as industries going through rapid change.

With support from existing limited partners and some new investors, Castlelake was oversubscribed and wrapped up the process in 23 weeks, according to a spokesperson for the firm, which is based in Minneapolis and London.

“The successful close of Castlelake III is evidence of investors’ confidence in our team and its experience as opportunistic investors,” Rory O’Neill, managing partner and chief executive of Castlelake, said in a prepared statement.

The latest fund is bigger than the $996.76 million raised in 2011 for TPG Credit Strategies Fund II LP, which closed above its $800 million target, according to the Thomson One private equity database. The firm’s first credit strategies fund raised $464.5 million in 2007, according to Thomson One.

Castlelake typically invests $10 million to $50 million to purchase loans from banks in North America and Europe.

O’Neill told Buyouts the firm changed its name in August, but the firm continues to have a relationship with TPG, he said.

Past LPs for Castlelake include include the California State Teachers’ Retirement System and the Arkansas Teacher Retirement System, according to Thomson One.