Prudential Capital Partners has closed their second middle-market mezzanine fund at $775 million. The fund plans to make $10 million to $50 million commitments to fund acquisitions, expansions, buyouts and recapitalizations.
Investors in Prudential Capital Partners II include pensions, fund-of-funds managers, banks, insurance companies and family offices, according to a press release. Senior Prudential executives have committed $32 million to a co-investment vehicle to work alongside the new fund.
Fund I closed in 2001 on $619 million and should be fully invested by mid-year, according to a statement by Prudential Capital managing principal Jeffrey Dickson. That fund has made 28 investments and realised seven.
Principal Mark Hoffmeister said the firm would continue to look for middle-market companies with stable cash flow and strong management. Prudential Capital Group has a $39 billion portfolio and invested more than $5 billion in the US in 2004.
The close comes as mezzanine lenders are being forced to become more flexible with increased competition from hedge funds, business development companies and an increased tolerance for leverage by banks lending senior debt. One industry observer estimates there are now around 200 sources of mezzanine capital, compared to 55 in 1999.