Park Square closes mezzanine fund at €850m

Park Square Capital II is a typical 10-year fund, with a five-year investment period. The management fee, carry and hurdle were described as in line with industry standard.

Park Square Capital II did not reach its target of €1bn, set two days before Lehman Brothers filed for bankruptcy in September 2008. Despite that, the firm reported strong endorsement from the LP community “in the midst of a challenging environment” over the past couple of years.

It is one of the largest mezzanine funds raised in Europe in recent years. In 2007, Intermediate Capital Group closed its fourth European Mezzanine Fund on its hard-cap on €1.25bn.

Across its fund programmes, Park Square has invested more than €2bn in 34 mezzanine investments, more than €500m in senior debt and approximately €500m in special situations.

Investors
Around 80% of the capital commitments come from large institutional investors including pension funds, insurance companies and sovereign wealth funds, from investors based in Europe, Asia and North America.

Investments
The fund aims to generate returns from mezzanine investments in stable companies, with predictable cashflows from all sectors. In terms of region, it focuses on Europe.

Approximately 30% of the fund has been invested over the past 12 months. Although the firm’s core mission is providing capital to new leveraged buyouts, it has also done secondary investments.

People
Park Square currently comprises of 35 full time staff, including 16 investment professionals and seven partners.

Advisers
Devoise & Plimpton LLP (Legal); KPMG LLP (Financial due diligence); Park Hill Group LLC (Placement agent).

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• Topics
• Mezzanine