Credit Suisse Group AG
) announced an agreement to spin off its DLJ Investment Partners
(DLJIP) operations to Portfolio Advisors, LLC. The spin-off will
also include the present investment team led by Igor DaCosta and
Charles Harper. The transaction is expected to close by the end
of this year.
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Incepted in 1995, DLJIP provides private debt and equity capital,
mostly to middle market companies related to the financing of
leveraged buyout transactions. Additionally, DLJIP supports the
growth, acquisition, recapitalization and refinancing of middle
market companies. Since 1995, DLJIP has garnered $3.6
billion of capital and has completed about 75 deals through its
Connecticut-based Portfolio Advisors is an employee-owned company
that provides private equity, private credit and real estate
investment solutions to both institutional and high net worth
clients through separately managed accounts and combined
On completion of the deal, Portfolio Advisors will be the
investment manager of three funds: DLJ Investment Partners LP,
DLJ Investment Partners II LP and DLJ Investment Partners III LP.
The deal will not result in any changes at the executive level
and the team headed by Igor DaCosta and Charles Harper will join
During the course of this year, Credit Suisse has been shedding
its private-equity units that allocate money to hedge funds and
other investment managers. In August, Credit Suisse sold its
secondary private equity business, Strategic Partners, to
The Blackstone Group L.P.
). In the same month, Credit Suisse announced the intention to
vend its private-equity unit Customized Fund Investment Group to
Chicago-based Grosvenor Capital Management LP.
For Credit Suisse, the spin-off is expected to considerably
reduce expenses. Moreover, by discarding its non-core businesses,
the company will be able to increase its focus on core
operations. Moreover, the move is an attempt by Credit Suisse to
comply with the Volcker Rule, which poses restrictions on banks'
exposure to riskier activities like proprietary trading or owning
hedge funds or private equity funds.
Currently, Credit Suisse carries a Zacks Rank #3 (Hold). Some
foreign banks that are worth considering include
Westpac Banking Corp.
Deutsche Bank AG
) with a Zacks Rank #1 (Strong Buy).