GSC Partners Europe has raised euro1.065 billion for its first mezzanine fund, GSC European Mezzanine fund, the largest dedicated mezzanine fund raised in Europe.
GSC European Mezzanine Fund was launched in April 2000. It announced its first closing the following July at $436 million and achieved a second closing at $660 million at the beginning of last year. The fund finally closed on euro765 million of committed equity capital last October and most recently signed an additional euro300 million credit facility to leverage the fund.
A good portion of the fund has come from the US, but there have also been commitments from investors in Europe, Asia, Latin America and the Middle East.
The emphasis will be on investments in medium to large size deals, ranging in size from euro50 million to euro75 million, with the ability to commit up to euro150 million.
Christine Vanden Beukel, managing director and partner of GSC Partners Europe, is optimistic about deal flow in spite of the downturn in the markets. She said: “The fund is reasonably busy given market conditions. But while there are opportunities to do things like recapitalisations and secondaries, there are less opportunities for new deals.”
Commenting on the GSC’s decision to launch a mezzanine fund, she said: “We saw an increase in private equity activity occurring in Europe, but not necessarily an increase in the availability of subordinated debt products.” She added: “As deals got bigger, there was a need for a mezzanine provider which could provide for these deals.”
The fund has already committed euro250 million in deals including Hicks, Muse, Tate & Furst’s Eubisco, Morgan Grenfell Private Equity’s buyout of Coral Eurobet and Texas Pacific Group’s Findexa transaction.