As Steve Rattner reportedly continues to negotiate with authorities over his alleged role in a pay-to-play scandal, executives at the firm he helped establish, Quadrangle Group LLC, are zeroing in on three options for their future. These include staying independent; selling to a private firm or partnering with one; or establishing a captive fund with a major corporation or wealthy family.
The firm is most likely to remain independent and continue to manage its investments, according to a source with direct knowledge of the options the firm is debating. Quadrangle would not likely make new investments or raise a new fund any time soon, although it could eventually, depending on how its most recent fund performs.
Under this scenario, Quadrangle may hire one or two senior professionals to help monitor Quadrangle’s portfolio. The firm is “very far along” in conversations with a few potential candidates, our source said. The firm would expect some of its investment professionals, including one or more managing principals, to look for work elsewhere.
Quadrangle has also looked into selling itself to, or partnering with, a larger private equity firm that might value Quadrangle’s experience in sectors such as media and telecommunications, or its office in Hong Kong. Quadrangle has held talks with several firms about this type of arrangement, our source said.
The third and least likely option would be partnering with a major corporation or wealthy family, which would provide money for a captive fund managed by Quadrangle.
Quadrangle executives hope to make a decision by the end of year, our source said. For more in-depth coverage subscribers to sister publication Buyouts Magazine can head to buyoutsnews.com.