The Carlyle Group has raised $1.38 billion for its first dedicated energy mezzanine fund, which targets investment opportunities in power-generation and oil and gas projects, primarily in North America.
Carlyle Energy Mezzanine Opportunities Fund was launched in late 2010 with a $750 million target and no hard-cap. It will invest between $20 million and $150 million per transaction and has already made six investments in a combination of power generation projects and oil and gas companies. The fund is managed by the New York-based Carlyle Energy Mezzanine Opportunities team, which focuses on credit and structured-debt investments in energy and power generation companies in the US and Canada.
“[The fund] provides growth capital which is less dilutive and more flexible than that of traditional private equity,” Carlyle managing director and co-head of energy credit investment David Albert said in a statement. “We enable owners to maintain control of their companies’ governance and to retain the bulk of the equity upside.”
The firm was unavailable for further comment at press time.
Carlyle’s first energy mezzanine fund is part of the firm’s Global Market Strategies division that includes a number of debt funds and distressed debt vehicles. The firm has had a strong 2012 on the fundraising front, raising 40 percent more capital through the first three quarters of the year compared to the whole of 2011. The firm raised $3.4 billion during the third quarter, bringing its total new commitments through Q3 to $9.4 billion, according to its third quarter earnings statement.
Carlyle manages a number of energy-specific co-investment funds. It’s most recent, Carlyle Energy Coinvestment IV, has raised about $39 million, according to documents filed with the US Securities Exchange Commission earlier this month.
Carlyle also raised several energy-focused funds with Riverstone Holdings. The Riverstone/Carlyle Global Energy and Power IV fund raised $6 billion in 2009 and its 2006 predecessor raised $3.8 billion. Riverstone concluded its relationship with Carlyle last year and is raising its fifth vehicle independently.
Carlyle’s $157 billion of assets under management are split between $53 billion in corporate private equity, $45 million in fund of funds, $29 billion in real assets and $30 billion in global market strategies.