Lehman Brothers announced the closing of a co-investment fund on $1.6 billion (€1.25 billion). The fund aims to make $5 million to $150 million minority investments alongside larger private equity groups and other financial sponsors, and it has already committed $300 million in 10 transactions so far.
Among these transactions, the fund has invested alongside Leonard Green & Partners in the retail chain The Sports Authority; The Carlyle Group in engineering company Firth Rixson; and Welsh, Carson, Anderson & Stowe in Mobile Storage Group.
The new fund was “significantly oversubscribed,” said Michael Odrich, Lehman Brothers’ managing director and global head of private equity, in a statement. More than $350 million of the fund came from Lehman Brothers and its employees.
The new fund is somewhat smaller than those run by some of Lehman Brothers’ investment bank competitors. Bear Stearns Merchant Banking, for example, closed a $2.7 billion fund in July, while Citigroup is planning to raise a fund totaling $2.5 billion.
Lehman Brothers’ private equity business also invests in merchant banking, venture capital, real estate and fixed income transactions, as well as in outside private equity funds. The firm currently manages private equity funds totaling more than $12 billion.