("Robert Bass, General Atlantic Invest In Oak Hill Advisors,"
published at 1829 EDT Oct. 25, misstated the name of the investment
vehicle of Robert Bass in the third paragraph.)
By Shasha Dai
Of DOW JONES LBO WIRE
Texas billionaire Robert M. Bass and
growth-capital-private-equity firm General Atlantic LLC have
acquired stakes in credit-investment firm Oak Hill Advisors LP, in
a sign that corporate debt remains in vogue among private-equity
investors.
Bass and General Atlantic bought out an interest held by iStar
Financial Inc. (SFI), a publicly traded commercial-real-estate
firm, which took a stake in New York-based Oak Hill in 2005. Oak
Hill continues to be majority-owned by its senior management,
including Co-Founder and President Glenn August. The firm has
almost $13 billion under management.
Financial details of the investment weren't disclosed. iStar
didn't respond to a request for comment, nor did Bass's investment
vehicle, Keystone Group L.P., of Fort Worth, Texas.
IStar determined that corporate credit was no longer a core area
for it, so the company and Oak Hill retained Citigroup Inc. (C) and
Morgan Stanley to find new buyers, people familiar with the
situation said. Those banks didn't respond to requests for
comment.
Personal ties played a part in the transaction, one person said.
August has known Bill Ford, president of General Atlantic, for a
long time, the person said, and was impressed by General Atlantic's
global presence.
In an email, General Atlantic spokeswoman Pat Hedley said the
firm believes in the continued growth of "financial services and
alternative investments," and that the investment will help Oak
Hill to "add investors globally."
Bass, a celebrated investor who helped launch the careers of
David Bonderman and Jim Coulter of Texas Pacific Group, now called
TPG Capital, also helped launch some of Oak Hill's first funds and
has been an anchor investor in the firm for 20 years.
Oak Hill's ties to Bass were cited by iStar as a key reason for
the company purchasing a minority interest in Oak Hill, according
to iStar's website. iStar was looking to expand into corporate debt
and thought Bass's support would give Oak Hill important
support.
European corporate debt has been vaunted as an attractive
investment area by several private-equity firms, as banks there
look to trim their riskier assets and bulk up capital, making them
more reluctant to lend to corporations. Several private-equity
firms have acquired investment firms with that specialty.
GSO Capital Partners, Blackstone Group LP's (BX) credit arm,
recently bought Harbourmaster Capital, a Dublin leveraged-loan
investor. H.I.G. Capital, a Miami middle-market firm, bought
WhiteHorse Capital, a Dallas debt investor.
(Dow Jones LBO Wire covers buyout and growth equity deals, as
well as private-equity fund-raising and other news of interest to
the private-equity community.)
-By Shasha Dai, Dow Jones LBO Wire; 212-416-2037;
shasha.dai@dowjones.com