Irving Place Capital

Irving Place Capital

Type	Private
Industry	Private equity
Predecessors	Bear Stearns Merchant Banking
Founded	1997 (1997) (2008 as Irving Place)
Founder	John D. Howard
Headquarters	New York, New York, United States
Products	Leveraged buyout, Growth capital
Total assets	$4.4 billion
Number of employees	50+
Website	www.irvingplacecapital.com

Irving Place Capital, formerly known as Bear Stearns Merchant Banking (BSMB), is a private equity firm focused on leveraged buyout and growth capital investments in middle-market companies across a range of industries.

The firm's predecessor Bear Stearns Merchant Banking was founded in 1997 by John D. Howard, formerly a co-founder of Vestar Capital Partners. The group completed its separation from Bear Stearns' owner JPMorgan Chase in 2008.

Irving Place Capital is based in New York City its predecessor had raised approximately $4.4 billion since inception across three Bear Stearns Merchant Banking funds.

Investments

Since inception, Irving Place Capital and its predecessor, Bear Stearns Merchant Banking has made a number of investments in notable companies in the retail, restaurants, consumer products, healthcare, energy, financial and business services, and industrial sectors. Among the firm's most notable investments are the following (separated by the private equity fund from which the investment was made:

• Fund I - Aéropostale, Integrated Circuit Systems (NASDAQ: ICST), NRT Incorporated, Safety 1st (NASDAQ: SAFT), Standard Hotel

• Fund II - Balducci's, CamelBak Group, Churchill Financial, New York & Company, Reddy Ice, Seven for All Mankind (jeans), Stuart Weitzman^[1] and Vitamin Shoppe.^[2]

• Fund III - Doral Financial Corporation, PlayCore,^[3] Caribbean Financial Group, Ironshore, MC Shipping,^[4] Rimrock Energy, Universal Hospital Services,^[5] Dots,^[6] Chesapeake^[7] and Thermadyne Holdings.^[8]

History

1997 - 2008

In 1997, John D. Howard was hired by Bear Stearns to launch a new private equity and merchant banking effort for the investment bank. Prior to joining Bear Stearns, Howard had been senior vice president of Wesray Capital Corporation and later co-founded Vestar Capital Partners in 1988. In 1998, Bear Stearns Merchant Banking raised its first fund with $200 million of investor commitments. Bear Stearns had been one of the pioneers of private equity investing in the 1960s and 1970s, when Jerome Kohlberg and later protégés Henry Kravis and George Roberts completed a series of what they described as "bootstrap" investments beginning in 1964-65 before leaving the bank to found Kohlberg Kravis Roberts in 1976.

In 2001, Bear Stearns Merchant Banking completed fundraising for its second fund with $1.5 billion of investor commitments including a $500 million commitment from Bear Stearns.^[9] The fundraising effort had begun 18 months earlier in 1999.^[10]

Bear Stearns Merchant Banking launched Bear Growth Capital Partners in 2003 to target smaller companies that fell below the investment parameters it had set for its main fund. Bear Growth Capital Partners made its investments from capital provided by Bear Stearns rather than an independent fund or drawing from BSMB's fund.^[11][12] Also in 2003, BSMB provided capital to a joint venture with Rudolph Giuliani's private equity firm, Giuliani Capital Partners to make investments in the security sector.^[13][14]

In 2006, Bear Stearns Merchant Banking raised its third fund with $2.7 billion of investor commitments.^[15][16]

The collapse of Bear Stearns in 2008

BSMB logo in use prior to the firm's rebranding as Irving Place Capital

In March 2008, Bear Stearns, BSMB's parent, faced what was repored to be a potential liquidity crisis. Through the intervention of the Federal Reserve and other US Government agencies, Bear Stearns agreed to a sale of the company to JPMorgan Chase on March 24, 2008, which was completed on May 30, 2008. Following the closing of this transaction, Bear Stearns Merchant Banking became a subsidiary of JPMorgan Chase. In March 2008, when the meltdown of Bear Stearns began, the firm dropped the Bear Sterns Merchant Banking moniker and began calling itself BSMB to distance itself from the failed investment bank.^[17][18][19]

In June 2008, it was announced BSMB would spin out of J.P. Morgan.^[20] The bank already had its own private equity investment group One Equity Partners, which had been acquired in the 2004 acquisition of Bank One. JPMorgan Chase had already decided to keep the One Equity Partners group over JPMorgan Partners (today CCMP Capital), the legacy private equity investment group that had come from Chase Manhattan Bank in the 2000 merger. was once again designated the exclusive private equity arm for the combined firm. As a result, it was clear that Bear Stearns Merchant Banking was not going to remain within the bank.^[21][22]

The Bear Stearns Merchant Banking team was one of several private equity groups within Bear Stearns Asset Management that was acquired by JPMorgan Chase. Other groups included:

• Bear Growth Capital Partners, a growth capital investment group founded in 2003 with a $375 million commitment from Bear Stearns.^[19][23] J.P. Morgan hired CCMP Capital to manage the legacy fund^[24]
• Bear Stearns Private Equity Ltd., renamed J.P. Morgan Private Equity Limited (LSE: JPEL), a publicly traded private equity vehicle making fund of funds and secondary investments^[25]
• Bear Stearns Health Innoventures, a venture capital fund established to invest in early- to mid-stage health care focused companies with a focus on the biotechnology sector^[26]
• Constellation Ventures a venture capital group, founded in 1998, making investments in the media, communications, software and services sectors^[27] Constellation, which was rebranded Constellation Growth Capital in May 2009, was spun out and subsequently entered into a joint venture with Highbridge Capital Management.^[28]

On November 1, 2008, Bear Stearns Merchant Banking completed a spin out from JPMorgan Chase to become Irving Place Capital.^[17][29]

See also

• Bear Stearns
• CCMP Capital
• One Equity Partners
• Doug Korn
• Chromalox, Inc.

References

External links

• Official website

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Merchant banking private equity groups (current and prior) ABN Amro AAC Capital Partners Bank of America Ridgemont Equity Partners Merrill Lynch Global Private Equity Barclays Capital Barclays Private Equity Barings Bank Baring Vostok Capital Partners GP Investments Bear Stearns Irving Place Capital (fka BSMB) CIBC World Markets Trimaran Capital Partners Citigroup Metalmark Capital Court Square Capital Partners CVC Capital Partners Credit Suisse DLJ Merchant Banking Avista Capital Partners Diamond Castle Holdings Deutsche Bank MidOcean Partners First Chicago Bank (defunct) Madison Dearborn Partners GTCR Goldman Sachs Goldman Sachs Capital Partners JPMorgan Chase CCMP Capital (fka JPMorgan Partners) One Equity Partners Lazard Lazard Alternative Investments Lehman Brothers (defunct) Trilantic Capital Partners Morgan Stanley Metalmark Capital Morgan Stanley Capital Partners Nomura Terra Firma Capital Partners UBS UBS Capital Affinity Equity Partners Capvis Lightyear Capital Wells Fargo Norwest Venture Partners Pamlico Capital William Blair & Company Chicago Growth Partners William Blair Capital Partners List of investment banking private equity groups