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Pine Brook Closes Second Fund at $2.43B for Financial Services, Energy Sectors

February 18, 2014, 07:06 AM
Filed Under: Industry News

Pine Brook, a New York-based investment firm focused on building businesses in the financial services and energy sectors, today announced the final closing of its second fund, Pine Brook Capital Partners II, L.P. (“Fund II”). With total capital commitments of $2.43 billion, the fund exceeded the firm’s target of $2 billion. Fund II has made five investments to date totaling $300 million.

The new fund will have nearly 70 percent more committed capital than the firm’s $1.4 billion debut fund, with about half of the commitments coming from existing investors. New investors include public pensions and endowments from the U.S., as well as investors from China, Europe and Southeast Asia that further diversify Pine Brook’s institutional investor base.

“We are delighted with our success in raising a second fund and are fortunate to have such strong support from the investment community,” said Howard Newman, president and CEO of Pine Brook. “This achievement validates our distinctive strategy of making business building and other growth investments.”

“There is no shortage of macro factors driving investment opportunities in both of our targeted sectors, including regulatory changes, demographic shifts and financial repression in the financial services industry, and the unconventional revolution in oil and gas,” added William Spiegel, co-founder of Pine Brook and head of the financial services investment team.

Like the firm’s debut fund, Fund II will target investments in new and growing companies in the financial services and energy sectors. Pine Brook typically finances these businesses with equity rather than debt, and often uses a Line of EquityTM funding structure in which a multi-year business plan is matched with a long-term capital commitment.

“We are excited to be off to such a great start in Fund II with five portfolio companies that hit the sweet spot of our investment strategy,” said Rich Aube, head of the energy investment team. Aube noted that the increased capital in Fund II will also allow Pine Brook to expand its opportunity set.

Investment highlights from Pine Brook’s debut fund, which closed in 2009, include the ongoing development of Common Resources III, LLC and Stonegate Production Company, LLC; the 2013 IPOs of Essent Group Ltd. and Third Point Reinsurance Ltd.; and the successful exits of Common Resources I, LLC; Common Resources II, LLC; Global Oilfield Services, LP and Syndicate Holding Corp.

Sidley Austin LLP served as corporate counsel and Credit Suisse acted as placement agent for the fundraising.

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