NewStar Financial has signed an agreement to buy Feingold O’Keeffe Capital (FOC), a private alternative asset firm based in Boston.
The deal will add about $2.3bn in AUM to NewStar’s AUM, bringing its total pro forma AUM to approximately $6.4bn.
Subject to customary closing conditions, the acquisition is slated to close in the fourth quarter of 2015.
The acquisition enables NewStar to grow in liquid loan, long/short and stressed and distressed debt offerings managed across a range of CLO, hedge fund, separate account and retail fund products.
Following the acquisition, FOC will operate as NewStar Capital, a wholly-owned subsidiary of NewStar Financial, and will be based in Boston.
Also, NewStar will retain FOC’s investment team and support staff to manage existing accounts and expects to expand the platform through organic growth in existing accounts and new fund formation with CLO risk retention solutions.
NewStar said that FOC co-founders, Andrea Feingold and Ian O’Keeffe, will co-lead the platform NewStar Capital.
NewStar added that FOC’s investment platform and capabilities are complementary to the company’s existing middle market direct lending strategies, which are delivered through three credit funds with nearly $1bn of managed assets.
NewStar chairman and CEO Tim Conway said: "This acquisition is consistent with our strategy to expand our asset management activities in ways that add to our value proposition for institutional investors and leverage our core strengths in direct lending, securitization and credit management."