Mid-market specialist The Riverside Company has hired five investment professionals from Veronis Suhler Stevenson who worked on the firms structured capital funds.
The additions of George Cole, Hal Greenberg, Michael Kessler, Jeffrey Gordon and Jay Reynolds will help Riverside launch a new fund family called the Riverside Strategic Capital Fund. The strategy will see Riverside make non-control junior capital investments in small, profitable and growing companies, primarily in the US but also in Europe, using both equity and debt securities. It marks the firm’s first expansion beyond its usual buyouts strategy.
“The Riverside Strategic Capital Fund will meet a clear need to provide capital to companies at the smaller end of the mid-market who face an increasingly difficult lending environment,” Graham Hearns, Riverside’s managing director of global marketing and communications, told Private Equity International.
The new strategy will continue to focus on the lower end of the mid-market, where Riverside’s four other fund families invest.
Riverside will not take over management of any VSS assets as a result of the new hires. Several members of VSS who work on the firm's structured capital funds will remain at the firm.
VSS, which focuses on investments in the media and communications sectors, has raised four buyout funds and two structured capital funds: VSS Mezzanine Partners and VSS Structured Capital II, which closed on $312 million, according to Private Equity International’s Research and Analytics division. Fund II is 93 percent invested.
The VSS Structured Capital Funds focus on investing in a combination of securities such as subordinated notes, preferred stock, common stock and/or warrants, according to the firm’s website.
Last December, John Suhler stepped down as president of VSS, the firm he co-founded alongside John Veronis in 1981. His retirement – effective 31 December, 2012 – was not unexpected, a spokesperson said at the time. Suhler and the firm established a succession plan over the last five years, according to a statement. Fellow co-founder Veronis left the firm in 2010.