BlueMountain Capital Management LLC has raised $736 million to invest in distressed debt and other credit strategies, sister magazine Buyouts reported, citing a regulatory filing. The vehicle, BlueMountain Credit Opportunities Fund LP, attracted commitments from 44 investors, the filing showed.
New York-based BlueMountain Capital, a private investment firm specializing in the global credit markets with $7 billion in assets under management, is primarily known as a hedge fund sponsor but identified this capital pool as a private equity fund. The firm’s flagship strategy is arbitrage, exploiting price gaps that can open up between indexes of credit default swaps and contracts on the companies that make up the indexes, according to a July profile in Bloomberg Businessweek of Andrew Feldstein, the firm’s CEO and chief investment officer. Feldstein was credited with helping JPMorgan Chase unwind its “London Whale” exposure, which threatened the bank with $3 billion in potential losses.
The firm did not respond to a request for comment.
BlueMountain Capital priced a $409.8 million collateralized loan obligation fund in May, according to sister service Thomson Reuters Loan Pricing Corp. CLOs hold about 45 percent of the loans issued by banks to support leveraged buyouts, LPC says. This was the firm’s first CLO since July 2011, when the firm priced a $361 million CLO.
The firm also makes equity investments in its target industries. Last November, for instance, BlueMountain Capital announced that it had acquired a majority stake in Navitas Lease Corp. Financial terms weren’t announced. Jacksonville, Fla.-based Navitas is an equipment leasing company. This investment was made with funds managed by BlueMountain and will provide Navitas with additional capital to support its multi-year growth plan, the firm said in a press release at the time
BlueMountain Capital, with offices in New York and London, was founded in 2003 by Feldstein and Stephen Siderow. Before launching his own firm, Feldstein spent more than a decade at JPMorgan Chase & Co., where he was head of global credit portfolio among other roles, according to the firm’s Web site. Siderow had been a senior consultant with McKinsey & Co. in New York Office, where he focused on the financial services industry, and before that was a corporate attorney with Cleary, Gottlieb in New York. The firm’s Web site lists eight senior executives.
The firm did not use a placement agent to raise the new credit opportunities fund, the filing showed.
UPDATE: BlueMountain closed the fund at $1.5 billion, a spokesman said. The firm’s assets under management have grown to $11 billion.
Steve Bills is a senior editor at Buyouts Magazine. Any opinions expressed here are entirely his own. Follow him on Twitter @Steve_Bills. Follow Buyouts tweets @Buyouts. For information on how to subscribe, contact Greg Winterton at firstname.lastname@example.org.
Image Credit: BlueMountain Capital Management