Stonyrock Partners and Jefferies Financial Group’s asset management unit are planning to raise as much as $1 billion of permanent capital to invest in alternative managers in the middle market, according to a person familiar with the joint venture.
With support from Jefferies division Leucadia Asset Management, new investment firm Stonyrock will buy minority stakes in alternative managers globally, according to their joint statement Tuesday. Stonyrock is led by former Blackstone Group managing director Craig Schortzmann and Sean Gallary, previously a managing director at Carlyle Group.
Schortzmann and Gallary did not immediately respond to emails seeking comment on their fundraising plans. Bloomberg earlier reported that Stronyrock was targeting $750 million to $1 billion for their fund.
Alternative managers are increasingly seeking outside capital to fund strategic priorities such as growth initiatives and succession planning, according to Stonyrock. These firms need help preparing for the “next stage of their life cycle” as the alternative investment industry matures, said Gallary, a partner at Stonyrock, in the statement.
Gallary was previously Carlyle’s head of the partnership strategy, while Stonyrock managing partner Schortzmann was formerly a senior member of Blackstone’s Strategic Capital Holdings Fund.
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Stonyrock is targeting alternative managers focused on a wide range of strategies, including private equity, credit, hedge funds, and venture capital. The firm’s partner, Leucadia, offers institutional investors alternative strategies through its affiliated asset managers.
“With the combination Stonyrock’s internal strategic capabilities and Jefferies’ global platform focused on the middle market, we see tremendous opportunity to work collaboratively with affiliate managers to create truly strategic partnerships,” Schortzmann said in the statement.