FRM Capital Advisors, the hedge fund seeding business of fund of hedge funds manager Financial Risk Management, has agreed to provide USD75m in seeding for Beechbrook Capital’s inaugural l
FRM Capital Advisors, the hedge fund seeding business of fund of hedge funds manager Financial Risk Management, has agreed to provide USD75m in seeding for Beechbrook Capital’s inaugural leveraged loan mezzanine fund, through the FCA Catalyst Fund’s second investment in three months and its first in Europe.
London-based Beechbrook was founded in May this year by Paul Shea and Nick Fenn to manage and advise funds investing in leveraged finance assets, predominantly in Europe. Beechbrook seeks to take advantage of the dislocation of the credit markets over the past 15 months, which has caused returns on these assets to rise sharply, while changing deal structures to the benefit of investors, offering an attractive risk return proposition.
Beechbrook launched its first fund, Beechbrook Mezzanine I, an English limited partnership, in September. Following the Catalyst Fund’s commitment of up to USD75m, the fund plans to raise further commitments for a second closing in 2009.
‘We are delighted to have this opportunity to invest with the Beechbrook team,’ says FRM Capital Advisors chief executive Clive Peggram. ‘The team’s strategy, combined with their experience and investment skill, makes them ideally placed to take advantage of the post-October environment. With FCA’s support and capital we are confident that Beechbrook will build a thriving leverage loan asset management business.’
Says Shea: ‘The current market conditions provide one of the most favourable investment opportunities the mezzanine debt industry has seen in many years. Working with FCA provides the basis to execute the strategy we have been developing.’
FRM Capital Advisors is an FRM Group business focused on identifying new or early-stage hedge fund managers and providing them with significant seed capital and guidance in building institutional-quality businesses. The firm’s investment professionals have extensive experience in hedge fund analysis, establishment, seed deal negotiation, business development, risk management, derivatives trading and investing.
Founded in 1991 by Blaine Tomlinson, the FRM group has some USD14bn billion in fund of hedge funds assets under management for sophisticated and institutional investors and more than 200 employees at its offices in London, New York, Tokyo, Hong Kong, Sydney and Guernsey.
