PE fund briefs, week of Dec. 17, 2007

New JLL fund could top out at $3B

New York-based buyout shop JLL Partners, which specializes in complex situations and build-ups, plans this month to send out a PPM with $2.5 billion on the cover for JLL Partners VI LP. The firm has already received soft circles from prior investors for $1.5 billion, equivalent to the size of its vintage 2005 fund, and fund VI could reach $3 billion, according to a source familiar with the firm’s effort.

Among its backers, the firm counts several limited partners—including Colorado Public Employees’ Retirement Association and Harvard University. Most, if not all prior LPs are expected to re-up, though to double the size of its fund, JLL Partners is expected to invite in new LPs as well, according to the source.

Its portfolio companies operate in a handful of industry sectors, including health care and financial services. JLL Partners typically buys companies in need of financial restructuring or improvement.

When it begins fund-raising, the firm can boast of several exits from fund V. For example, its 2005 investment in J.G. Wentworth, a structured settlement broker, has already returned more than 2x invested capital through two dividend recaps. The firm’s stake in J.G. Wentworth is valued at 6.1x following an equity float over the summer on a Bear Stearns private trading platform, which saw about a dozen institutional investors buy pieces of the company.

JLL Partners also notched a 2.9x return on the sale of Mosaic Sales Solutions earlier this year, from an investment in fund IV. —Jeremy Harrell

Blackstone raises $1.3B debt fund

The Blackstone Group announced late last week that it had closed a $1.3 billion fund to invest in the debt markets.

The fund, Blackstone Credit Liquidity Partners, will look for investments worldwide in a broad range of debt and debt-related securities and instruments, including bank debt, publicly traded debt securities, bridge loans and structured financial products such as collateralized debt obligations, a.k.a. CDOs.

“Our objective is to generate superior risk-adjusted returns from a combination of current income and capital appreciation,” said President Hamilton James in a prepared statement. “With Blackstone’s outstanding track-record in debt and distressed investing, we are confident that we can benefit our new fund’s investors by capitalizing on current conditions in the credit markets.”

EnCap raises $2.5B

EnCap Investments has closed its seventh fund, EnCap Energy Capital Fund VII, with $2.5 billion in capital commitments.

The Houston, Texas-based firm focuses on private equity opportunities in the upstream oil and gas industry. EnCap raised $1.5 billion for its sixth fund in 2006.

EnCap has already committed $550 million of EnCap Fund VII to nine portfolio companies, four of which are led by management teams that EnCap has backed in prior funds.

“It is always gratifying in a fund-raising effort to reach your hard cap and end up substantially oversubscribed,” the firm said in a prepared statement.

HarbourVest goes public

HarbourVest Partners, a Boston-based fund of funds manager, has floated a closed-end investment vehicle called HarbourVest Global Private Equity on the Euronext Amsterdam. The offering came up $100 million short of its $400 million target, but nonetheless managed to maintain the vehicle’s $830 million initial market cap.

HarbourVest Global Private Equity is managed by HarbourVest Advisers, an affiliate of HarbourVest Partners.

Liquid Realty closes fourth fund

Liquid Realty Partners has closed its fourth real estate secondaries fund with $572.3 million in capital commitments, beating its $400 million target.

The firm says that LRP IV is the largest discretionary real estate secondaries fund raised to date. In the past 24 months, the San Francisco-based real estate secondary specialist has committed more than $1 billion in equity to global investments in indirect real estate vehicles.

Overseen by Managing Principals Scott Landress and Jeff Giller, the new fund will invest in all types of real estate funds, partnerships and trusts globally. More than half of Liquid Realty’s past investments were located outside of the United States.