CSFB Advisory Wraps Domestic Fund At $2.7B –

After a long and successful fund raising, Credit Suisse First Boston Advisory Partners, LLC, the private equity arm of Credit Suisse Group, held a final closing that brought Credit Suisse First Boston Equity Partners, L.P. to a total of $2.743 billion in capital under management, said David Denunzio, chief executive officer of CSFB Advisory Partners.

The close follows a series of rolling closes that until now had brought the fund to the $2.37 billion mark.

Launched last April with a target of $1.5 billion (BUYOUTS May 4, 1998, p. 6), CSFB Equity Partners was the first vehicle that the private equity arm has marketed to a large limited partner audience and the first domestic effort to bear the CSFB name since the group decided to stop investing through The Clipper Group and Windward Capital Partners in 1997 (BUYOUTS Aug. 4, 1997, p. 1).

Although Denunzio declined to name limited partners that signed on to the fund, he noted that the mixture included the usual suspects, including institutional investors, insurance companies, endowments and corporate and public pensions, as well as a large number of individuals with which Credit Suisse Group had historic relationships.

Reaching Out to Limited Partners

The ambitious size of the effort-with the close CSFB Advisory Partners quickly has entered the ranks of the top 20 largest buyout funds-was a function of the group wanting to make itself known as a major player not only on the deal side, but also on the fund-raising side. “We wanted to clearly establish ourselves as an important factor in the marketplace amongst limited partners,” Denunzio said.

The fund will look to invest in a variety of areas in private equity, including buyouts and later stage growth investments, and will have the capacity to invest in minority stakes of publicly traded companies. In most situations CSFB Equity Partners will look to deploy at least $20 million in capital per deal, although some technology deals may require smaller equity commitments, according to a source close to the firm. Indeed, a primary focus of the effort is leveraging the investment bank’s technology research department to provide the fund with a strategic advantage. The backing of Credit Suisse Group, which directly contributed $500 million to the effort, and co-investment rights provided to limited partners put little size limit on the fund’s investments, the source added.

In addition to Denunzio, the fund also will be managed by John Hennessy, chairman of CSFB Advisory Partners, and Michael Schmertzler and Hartley Rogers, who will act as co-heads of the vehicle. According to the source, G.P.s of the fund contributed capital to an additional fund that will invest alongside the private equity vehicle, although the source declined to disclose the size of this fund.