Morgan Stanley Nets Almost $1B For Mezzanine Hedge Fund

Jan 12 2011 | 2:07pm ET

Morgan Stanley’s asset management unit has raised nearly $1 billion for a new corporate debt hedge fund.

Morgan Stanley Credit Partners has already invested $160 million of the $956 million it raised in five companies, the firm said in a statement. The fund, Morgan Stanley Investment Management’s first dedicated corporate mezzanine fund, focuses on middle-market debt in North America and Western Europe.

Credit Partners will target investments of between $20 million and $50 million and will consider co-investments. It will be run by Hank D’Alessandro, formerly head of Morgan Stanley’s financial sponsor leveraged-finance business.

“The market for mezzanine debt investing is benefiting from favorable secular trends resulting from an underlying imbalance between the demand for and the supply of capital, particularly for middle market companies,” D’Alessandro said. “We already have a robust investment pipeline in place, and we believe the Fund is well-positioned to continue to benefit from these dynamics.”

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