Private equity firm Clearlake Capital Group has received an investment from a division of Neuberger Berman, Goldman Sachs Group's asset management business, and Landmark Partners to create a credit unit.
The deal gives the group a minority stake at the firm, according to a statement Tuesday from Clearlake. “This permanent capital will allow us to seed a performing, senior credit effort,” Clearlake’s co-founder and managing partner, José Feliciano, said in a phone interview.
While the firm already does a bit of investing in credit through its core investment fund, the fresh capital will allow the firm to start a dedicated debt business. Clearlake’s plan to seek a minority investment began roughly one year ago, with talks initially beginning with existing investor Landmark, according to Feliciano.
"Having developed a strong team with deep sector expertise and significant infrastructure since the firm’s inception almost 12 years ago, I believe that the Clearlake franchise is ready to capitalize on pure play credit opportunities," Feliciano said.
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At the start of 2018, Clearlake's talks for a minority expanded to include Dyal Capital Partners, which is a division of Neuberger Berman and Goldman Sachs Asset Management's Petershill program, which invests in alternative asset managers, Feliciano said. This is the first time that Goldman and Dyal have co-invested in a private equity manager, according to Feliciano. The firms are typically seen as competitors in the industry.
According to a source familiar with the matter, Dyal and Goldman’s investments in the firm were a fifty-fifty split made after Landmark’s investment had been made.
“We anticipate that the partnership with Goldman may bring significant strategic benefits with their diverse and global product offering,” Feliciano said. “For example, as we look to put in place subscription lines and other credit facilities for our funds, Goldman is a natural candidate as one of the leading providers of such leveraged facilities that credit funds routinely utilize.”
Clearlake expects to raise a private debt fund for its new business in 2019 or 2020. Separately, the firm may be in the market with a second opportunity fund as early as the second half of this year, according to a source familiar with the matter. Its first opportunity fund, which it used to invest in special situations, was launched in 2015, and closed at around $550 million.
Chris Alfeld, partner at Landmark, did not return a phone call or an email seeking further comment on the deal. Spokespeople for Dyal and Goldman declined to comment.