DLJ European Private Equity is buying itself out of Credit Suisse First Boston.
The newly independent business will operate under the name Phoenix Equity Partners, a group which was acquired by DLJ in 1997. It is not known how much DLJ European Private Equity will pay CSFB but the deal is believed to include a cash payment now and a deferred consideration based on performance.
CSFB already has a private equity business in Europe which invests in both larger transactions and mid-market European growth companies. DLJ also focuses on mid-market and the two groups decided it would be better to separate because of that overlap. Phoenix Private Equity will be based at CSFB's offices.
Phoenix will continue to manage the £50m Phoenix Development Capital Fund, the £133m Phoenix Equity Partners II Fund, and DLJ Phoenix Equity Partners III fund, which will make no additional investments beyond the £71m already invested in three portfolio companies.
The company was originally established in 1991 as the sister company to Phoenix Securities Limited, an advisory business focusing on the financial services sector. Phoenix Group Limited was acquired by DLJ in 1997.
Hugh Lenon, a co-founder and managing partner of Phoenix, said: “During our four years as part of DLJ and, latterly, as part of CSFB, we grew our business successfully and we benefited, to a considerable extent, from deal flow generated by our colleagues within DLJ and CSFB. Nevertheless, following the acquisition of DLJ by CSFB, we are pleased to be regaining our independence. Our pipeline of potential investments is strong, we have £250 million of capital, and we are extremely positive about the prospects for UK mid-market private equity investing.”
CSFB acquired Donaldson Lufkin & Jenrette in November last year and has been endeavouring since then to retain key personnel across all DLJ's operations.