Vanterra reaches $152m first close

The fund of funds and co-investment firm, which will focus on the US lower middle market and emerging markets like India and China, is targeting $300m for its debut fund.

Vanterra Capital has surpassed the halfway mark for its first fund of funds, which aims to raise $300 million by early 2009.

The lower mid-market firm has held a first close on $152 million after less than four months of marketing. The firm has already committed $20 million to the $400 million New York Life Investment Management (NYLIM) Jacob Ballas India Fund III, according to Shad Azimi, principal with Vanterra. Azimi was formerly a principal at New York Life Investment Management, which has a $7 billion private equity programme.

Vanterra invests in smaller and emerging private equity funds and makes direct equity investments focused on the lower middle market. The firm works with managers with “differentiated strategies” for co-investment opportunities as well as direct investments.

Along with the US lower middle market, Vanterra will invest with managers targeting emerging markets like China, India, the Middle East, Africa and Eastern Europe.

“We believe two things have created opportunities, the market dislocation and capital scarcity, and we feel that 2009/2010 could be amongst the best vintages in private equity,” Azimi told PEO. “If you look at what vintage years private equity funds have performed really well, it's recessionary environments. You're investing at depressed valuations; this could be a great time to put capital to work.”

Vaterra's principal investor is an affiliate of Quadrant Management, which manages more than $3 billion.

The firm's founders are Azimi; Alan Quasha, chief executive officer of Quadrant; and Jason Young, a managing director of Quadrant.

Vanterra also has an advisory board that includes Glenn Hubbard, dean of Columbia Business School; John Schumacher, CEO of New York Life Capital Partners; Khaled Al-Muhairy, founder and CEO of Dubai-based firm Evolvence Capital and Hassan Nemazee, chairman and CEO of Nemazee Capital.