There are currently 66 private equity mezzanine funds in market collectively targeting an aggregate $21bn in capital commitments, according to Preqin’s Funds in Market product. Of these funds, 43 primarily focus on North America, collectively targeting $15bn and representing 71% of the total capital targeted. Twelve mezzanine funds in market are investing in opportunities in Europe, with an aggregate target of $4bn. The remaining funds consist of five Asia-focused funds and six funds seeking opportunities across other regions of the globe, with a combined target of $2bn in capital commitments.
The majority (68%) of private equity mezzanine funds in market are managed by fund managers located in North America. The next highest concentration of fund managers currently raising mezzanine funds is the UK, with five fund managers located in the region.
As of June 2013, 30 mezzanine private equity funds in market have held at least one interim close, raising an aggregate $4bn in capital commitments so far. The average target size for mezzanine funds in market is currently $374mn, 9% lower than the average of $410mn in June 2012.
The largest mezzanine private equity fund currently in market, Crescent Mezzanine Partners VI, is targeting $2.5bn. The fund is the first private equity to be managed by US-based Crescent Mezzanine Partners since spinning out from TWC Group early in 2011. So far it has held one interim close, collecting just over $1bn in capital commitments.
The second largest fund in market, Sankaty Middle Market Opportunities Fund II, is aiming to raise $1bn. The fund is managed by Sankaty Advisors and its fundamentals include purchasing subordinated debt, senior and second lien loans, preferred and common stock and other instruments of middle market companies. ABRY Senior Equity IV is the third largest, targeting $950mn and seeking investment opportunities across North America in business services, communications, information services, media, and technology and telecoms sectors.