Castlelake closes Fund III on $1.4bn

Castlelake held a final close on its third flagship fund’s $1.4 billion hard-cap, surpassing the vehicle’s $1 billion target, the firm announced in a statement on Tuesday.

The fund received commitments from new and existing limited partners, a Castlelake spokesperson told Private Debt Investor in an email. The fund will invest in European non-performing loans, global aviation, U.S. distressed asset opportunities and dislocated industries on an opportunistic basis.

Denning & Company acted as the fund’s placement agent.

“The successful close of Castlelake III is evidence of investors’ confidence in our team and its experience as opportunistic investors,” said Castlelake’s managing partner and chief executive officer Rory O’Neill in a statement.

The firm’s previous fund had generated a 22.8 percent internal rate of return as of 31 March, according to performance data from the California State Teachers’ Retirement System.

Castlelake, formerly known as TPG Credit, held a first close on $500 million in December. Bloomberg reported that Fund III will have a three year investment period upon final close. The firm will charge a 1.75 percent management fee during the investment period and 1.5 percent upon its conclusion. The firm will collect a 20 percent carry fee with an 8 percent hurdle.

Castlelake was founded in 2005 and had $3.6 billion under management. The firm maintains offices in Minneapolis and London.