Firm: Tennenbaum Capital Partners LLC
Fund: Tennenbaum Opportunities Fund VI LLC
Target: $1 billion
Raised: $530 million
Placement Agent: Greenhill & Co.
With one of its founders stepping back in a reduced role,
Tennenbaum joins a host of turnaround shops raising fresh capital to capitalize on a slowing economy amid signs of a tightening credit markets. The latter development, if it takes hold, would provide fewer opportunities for overleveraged, underperforming companies to refinance their way out of trouble.
Based in Santa Monica, Calif. and employing some 35-40 investment professionals, Tennenbaum set out in early 2009 to raise $1 billion for
By mid-2009 Tennenbaum Capital Partners spotted another big opportunity—to provide debtor-in-possession financing to companies in bankruptcy. Traditional lenders in that market had retreated in the wake of the financial crisis, leaving a chance for new players to come in and generate high-teens returns between origination fees, coupon rates and exit fees. Within a few months the firm, after putting Fund VI on hiatus, had rounded up $454 million for
The firm got back on track with Tennenbaum Opportunities Fund VI by early 2010. It more or less wrapped it up on Aug. 12 in the neighborhood of $530 million after the investment committee of
Although still active in the firm, Michael Tennenbaum, 75, who helped found Tennenbaum Capital Partners in 1999, and its predecessor in 1996, is taking a reduced role on Fund VI, according to our source familiar with the firm. He will hold a non-voting seat on the investment committee. Co-founders and Managing Partners Howard Levkowitz and Mark Holdsworth, both in their mid-40s, are seen as two of the senior leaders of the firm, heavily involved in day-to-day operations. Other voting members of the investment committee on the new fund include Managing Partners David Hollander, Michael Leitner and Rajneesh Vig, according our source.
Since 1999 the firm, with some $5 billion under management, has invested about $9 billion in more than 170 portfolio companies.