Constitution is made up of the former U.S. team of Standard Life Investments, which quit en masse late last October. It took a few months to get Constitution up and running, but the team made sure to keep itself in front of general partners.
“When we parted ways with SLI, we used our own credit cards to fly out and meet with Windpoint and Sun Capital and other firms we had been investing with,” says Constitution Managing Partner Dan Cahill, who was at Towerbrook Capital’s annual meeting last week in Pebble Beach, Calif. “We didn’t have any money behind us, but we didn’t want that to mean we’d disappear.”
Cahill says that USS reached out to Constitution, and that the first handful of fund commitments and co-investments should occur within weeks. Constitution hopes to secure similar mandates from other institutions, and also is raising a separate fund of funds. Cahill declined to discuss the fund of funds or what the “warehouse line” is being used for. —Dan Primack
Goldman Sachs nears $7B
Goldman Sachs Group Inc.
is close to completing a $7 billion structured investment vehicle (SIV), a source familiar with the matter said, boosting hopes for a revival in the market for mortgage assets in which the SIV invests.
“I can say the FT report is correct,” the source told Thomson Reuters, referring to a story in last week’s Financial Times. Goldman declined to comment.
The SIV invests in asset-backed securities and collateralized debt obligations. SIVs hit trouble last fall when liquidity in the credit markets dried up, preventing them from raising funds and also causing the value of their assets to drop. SIVs, held by banks, hedge funds and private equity firms, issue a mixture of short-term debt and capital to buy longer-term assets, which pay more interest than the amount they pay on their notes. —Thomson Reuters
Cerberus raising distressed debt fund
The Cerberus fund will focus on international assets, with only a small percentage likely to be devoted to the United States, Snow said. The former U.S. Treasury Secretary declined to give a target size for the fund. Snow said in an interview at a financial conference in Beijing that he expected that investors from both sides of the Pacific Ocean would put up money for the new fund.
Snow declined to comment on whether he had met any Chinese officials or firms about investing in the distressed asset fund, but he said that Cerberus saw a role for itself in channeling Chinese cash abroad.
“Our funds are open, and we are prepared to talk to people who want to invest with us. We are not exclusive,” he said.
Chinese state agencies in recent months have invested in two foreign private equity funds—one set up by TPG Capital and the other by J.C Flowers & Co. In addition, China’s sovereign wealth fund last year took a $3 billion stake in Blackstone before the private equity firm’s IPO.
Beijing has also been pushing the development of a domestic private equity industry, but its rule changes, such as promoting funds raised in the yuan currency, have tilted the advantage toward local players and have frustrated foreign firms.
“We’re prepared to take stakes [in China], but you have to play the ball where it lies,” Snow said. —Thomson Reuters
Lehman to invest in hedge funds
The investment bank aims to raise $3 billion to $5 billion for the vehicle, which it began marketing last month. Lehman has used its own capital to pursue the same investment strategy, typically purchasing 20% stakes in large, established hedge fund operators. Its previous investments have included stakes in D.E. Shaw and GLG Partners.
The bank is expected to hold a first close within the next few months and will likely invest in eight to 12 different hedge fund managers, according to PEI.
Another Romney enters private equity
The younger Romney is one of four co-founding principals of
You might notice that both Miller and Scheuermann still seem to have other full-time jobs, so I’ve put in calls to both for clarification. (Update: Miller says he’ll be fulltime once JBS SA completes its acquisition of National Beef this fall)
The 38-year-old Tagg Romney, who most recently he was chief marketing officer for the Los Angeles Dodgers, says that Solamere has already made a handful of investments, but he declined to give specifics. The investments could be in either companies or other private equity funds, according to a document obtained by PE Week. —Dan Primack
Great Hill raising fund IV
Edgewater banks on $750M
Waterland shores up fund IV
Waterland Private Equity Investments