Credit Suisse First Boston has announced plans to combine its private equity, hedge fund and other alternative asset businesses to create a new group that will trade as Alternative Capital Division (ACD). The division will be run out of New York.
The new unit aims to generate $1 billion (€813 million) in annual revenues and have $50 billion (€40.7 billion) in assets under management over the next five years, according to a press statement. The new division will remain separate from Credit Suisse’s existing Asset Management (CSAM) group, which currently manages more than $300 billion in assets.
CSFB also said that Bennet Goodman, who previously served as chairman of CSFB Merchant Banking and Leveraged Finance, will lead the new division. Jack DiMaio, who will report to Goodman, will continue to oversee CSAM’s alternative investment funds and products.
CSFB’s new arm will include all private equity operations, which currently manage more than $29 billion in assets. ACD will also include CSFB’s global fund placement business, the so-called Private Fund Group, which will continue to raise capital for leveraged buyouts and real estate fund managers.
Also reporting to Bennett will be Tom Dean, Andy Rifkin, John Moriarty, Mike Arpey and Steve Can, who will continue to run the firm’s private equity funds, as well as the co-heads of the CSFB Private Fund Group, Bob Rivett and Chad Schultz.
In addition, the bank said it would supplement CSAM’s hedge fund and fund of funds businesses with “a new investment vehicle that will focus on leveraged finance assets,” the statement said. CSFB is contemplating additional fixed income and public equity products for the future.
The restructuring of CSFB’s alternative investment activities comes after Larry Schloss, the former head of the bank’s market leading $29 billion private equity business, stepped aside late last year.