NEW YORK – Investment bank Credit Suisse First Boston (CSFB) in early January was finalizing the private placement memorandum for its long-awaited new fund-of-funds and expected to launch the vehicle by the end of the month.
The $500 million-targeted fund for institutional clients primarily will focus on international and domestic buyout vehicles, but also will evaluate opportunities in venture capital, mezzanine and oil & gas, said CSFB Vice President Steve Costabile, who joined the bank from the Massachusetts Pension Reserves Management board in July (VCJ, August 1998, page 30) to help oversee the new fund.
CSFB is expected to commit at least $100 million to the vehicle, and other investors will consist of “friends of the firm and third parties,” Mr. Costabile added. A first close is anticipated late in the first quarter, before a final wrap in the spring.
Mr. Costabile expects investor interest in the fund to be “very favorable,” explaining that the vehicle is well suited for limited partners who lack the resources or relationships to which CSFB has access.
The fund, which will concentrate on continental Europe, is being launched at a very opportune time, as the introduction of the euro is expected to be favorable to buyout activity in the region, spurring cross-border consolidations and an “Americanization” of buyout deals, Mr. Costabile explained. The fund is tentatively slated to make approximately 15 to 20 investments, averaging $25 million to $50 million apiece.
The new vehicle will be managed by Mr. Costabile and Director Henry Robin, who joined CSFB from the John D. and Catherine T. MacArthur Foundation in June 1998.