Lehman to float private equity IPO

Lehman Brothers plans to raise $500 million for a fund that invests in private equity companies, according to published reports.
JUN 20, 2007
Lehman Brothers plans to raise $500 million for a fund that invests in private equity companies, according to published reports. The new company, Lehman Brothers Private Equity Partners Ltd., will be floated on Euronext in Amsterdam, with conditional dealings expected to begin on July 18 and unconditional dealings to begin July 25. The new company plans to issue a single class of U.S.-dollar-denominated shares at $10 each, with the parent company subscribing to purchase $100 million of shares, which will be subject to a three-year lock-up. The portfolio of stakes in private equity funds and direct investment in companies will be picked out by Lehman Brothers Private Fund Investments Group. It’s been a big year for public offerings of alternative investment vehicles. Most prominently, hedge fund Fortress Investment Group LLC was floated on the New York Stock Exchange in February (InvestmentNews, February 9) . The Blackstone Group LP, a New York-based private equity company, announced yesterday that it will move its initial public offering up to tomorrow (InvestmentNews, June 19) . Lehman's private fund investments group manages $6.5 billion and has generated an internal rate of return of 18.1% net of fees and expenses since 1987, according to published reports.

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