Lone Star Funds, legal name of main entity Lone Star Global Acquisitions, Ltd. is a global private equity firm that invests in corporate equity, real estate, credit, and other financial assets.[1] The founder of Lone Star established its first fund in 1995 (under a different name) and Lone Star has to date organized 25 private equity funds with total capital commitments since inception of over $95 billion (as of 2024).[2][3][4] Lone Star's investors include corporate and public pension funds, sovereign wealth funds, university endowments, foundations, fund of funds and high-net-worth individuals.[5] Lone Star Funds has affiliate offices in North America, Europe and Japan.[6]
 | |
| Company type | Private |
|---|---|
| Industry | Private equity |
| Founded | 1995 |
| Founder | John Grayken |
| Headquarters | Dallas, Texas, United States |
Key people |
|
| Products | Private equity, real estate, credit |
| AUM | $95 billion (2024) |
| Website | www |
Hudson Advisors LP, an approximately 900-person global asset management company owned and controlled by the founder of Lone Star, performs due diligence and analysis, asset management and related services for Lone Star Funds.[7] In this capacity, Hudson Advisors LP has managed in excess of $260 billion of assets for Lone Star Funds since inception.[8]
History
editLone Star was founded by John Grayken.[9] From 1993 to 1995, Mr. Grayken was chairman and CEO of Brazos Partners L.P., a joint venture between the Robert M. Bass Group and the Federal Deposit Insurance Corporation,[10] that resolved approximately 1,300 “bad bank” assets resulting from the U.S. savings and loan crisis in the early ‘90s.[11] During this period, Brazos Advisors LLC was formed to provide asset-management and related services to Brazos Partners.
Following Brazos Partners, Grayken organized institutional capital to continue investing in distressed assets, closing Brazos Fund, L.P. in 1995 with approximately $250 million of capital commitments.[12]
Lone Star Opportunity Fund, L.P. followed in 1996, with approximately $396 million of capital commitments.[13] At that time Brazos Advisors, LLC was renamed Hudson Advisors LLC.[14]
After an expansion into Canada in 1995 and 1996, Grayken pursued the launch of a global platform for Lone Star in 1997.[15] Since then, Lone Star has invested extensively in North America, Europe and East Asia.[16] Lone Star invested primarily in East Asia, including Japan, Korea, Indonesia and Taiwan, following the Asian financial crisis in the late 1990s.[17] In the mid-2000s, following the establishment of the Eurozone, Lone Star increased its investment focus in Europe.[11] And with the onset of the global financial crisis, from 2007 Lone Star was again actively investing in the U.S.[9]
Through its credit affiliate, LStar Capital (officially LSC Film Corporation), the company entered the motion picture financing sector when they signed a $200 million deal with Sony Pictures in early 2014. The deal gives them a financial stake in nearly all of Sony's upcoming films.[18] However, due to the poor box-office performance of Sony's movies, the two firms severed ties on July 17, 2017, two years before the deal was set to end.[19]
In July 2015, Lone Star acquired the UK property investment and development company Quintain for £700 million.[20]
In March 2017, the Portuguese Central Bank announced that Lone Star Funds will acquire 75% of third largest Portuguese bank, Novo Banco, in return for a capital injection of €1bn.[21] The other 25% will be retained by the Portuguese bank's resolution fund. In October 2017 the deal was closed and Lone Star Funds started controlling 75% of Novo Banco.[22]
Investment approach
editLone Star invests in a variety of asset classes, primarily asset-heavy and/or cash flowing opportunities in developed markets.[23]
Funds
editThe following list shows the company's various funds.[24]
| Fund | Vintage Year |
Committed Capital |
|---|---|---|
| Lone Star Real Estate Fund VII | 2024 | $2.7B[25] |
| Lone Star Fund XII | 2023 | $5.3B[26] |
| Lone Star Residential Mortgage Fund III | 2022 | $657M[26] |
| Lone Star Value-Add Fund II | 2022 | $619M[26] |
| Lone Star Value-Add Fund I | 2020 | $759M[27] |
| Lone Star Real Estate Fund VI | 2019 | $4.7B[28] |
| Lone Star Residential Mortgage Fund II | 2019 | $761M[28] |
| Lone Star Fund XI | 2019 | $8.1B[29] |
| Lone Star Fund X | 2017 | $5.5B[29] |
| Lone Star Real Estate Fund V | 2016 | $5.8B |
| Lone Star Real Estate Fund IV | 2015 | $5.8B[30] |
| Lone Star Residential Mortgage Fund I | 2015 | $1.3B[31] |
| Lone Star Fund IX | 2014 | $7.2B[32] |
| Lone Star Real Estate Fund III | 2013 | $7.0B |
| Lone Star Fund VIII | 2013 | $5.1B |
| Lone Star Fund VII | 2010 | $4.6B |
| Lone Star Real Estate Fund II | 2010 | $5.5B |
| Lone Star Fund VI | 2008 | $7.5B |
| Lone Star Real Estate Fund | 2008 | $2.4B |
| Lone Star Fund V | 2005 | $5.1B |
| Lone Star Fund IV | 2002 | $4.2B |
| Lone Star Fund III | 2000 | $2.3B |
| Lone Star Fund II | 1999 | $1.2B |
| Lone Star Opportunity Fund | 1997 | $396M |
| Brazos Fund | 1995 | $250M |
References
edit- ^ Ellie Pullen (April 29, 2013). "Lone Star and Credit Suisse buy €6.7bn RPI portfolio". Unquote.com. Archived from the original on June 29, 2015. Retrieved November 26, 2013.
- ^ "About Lone Star". Lone Star Funds.
- ^ "Two Palm Beach Senior Communities Sell for $57M". The Real Deal South Florida. 2021-06-03. Retrieved 2021-12-21.
- ^ Carlisle, Candace (11 April 2024). "Lone Star Promotes Executive to CEO, Global President Roles". CoStar News.
- ^ Chad Eric Watt (August 22, 2010). "Lone Star selling S.E. grocery chain". Dallas Business Journal.
- ^ "Company Overview of Lone Star Funds". Bloomberg BusinessWeek. Archived from the original on September 27, 2008. Retrieved November 24, 2013.
- ^ "About Hudson Advisors". Hudson Advisors.
- ^ "History and Experience". Hudson Advisors.
- ^ a b Megan Barnett (April 29, 2013). "Lone Star". Unquote.com.
- ^ Jenny Anderson (July 30, 2008). "An Investment Firm That Prospered From Past Crises Turns to Mortgages". The New York Times.
- ^ a b Steve Bills (May 30, 2013). "Distress Specialist Lone Star Turns To Europe". Thomson Reuters.
- ^ "About Lone Star". Lone Star Funds. Retrieved November 25, 2013.
- ^ "Hudson Advisors Successful Track Record". Hudson Advisors. Archived from the original on December 2, 2013. Retrieved November 25, 2013.
- ^ "Brazos Advisors renamed Hudson Advisors; corporate offices relocated". Business Wire. April 9, 1997.
- ^ "Los Angeles Department of Water and Power Retirement Board Interdepartmental Correspondence" (PDF). Los Angeles Department of Water and Power Retirement Board. August 18, 2010.
- ^ "Ahold completes Bruno's, Bi-Lo sale". Birmingham Business Journal. January 31, 2005.
- ^ Keith Russell (April 7, 2002). "Shoney's a typical fit for Lone Star Funds". The Tennessean.
- ^ "Sony Nails $200 Million Co-Financing Deal with LStar Capital, Citibank". The Wrap. April 9, 2014.
- ^ Faughnder, Ryan (2017-07-17). "Sony Pictures and co-financing partner LStar Capital cut ties". Los Angeles Times. ISSN 0458-3035. Retrieved 2017-07-19.
- ^ Kollewe, Julia (29 July 2015). "Lone Star buys Wembley Arena owner Quintain for £700m". The Guardian. Retrieved 29 July 2015.
- ^ Chad Bray (March 31, 2017). "Lone Star to Buy Controlling Stake in Portugal's Novo Banco". The New York Times.
- ^ "Lone Star takes charge of Portugal's state-rescued Novo Banco". Reuters. October 18, 2017.
- ^ Kelly DePonte (May 2010). "An overview of the private equity distressed debt and restructuring markets" (PDF). Probitas Partners. Archived from the original (PDF) on 2013-03-30. Retrieved 2013-11-28.
- ^ "The Funds". Lone Star Funds. Retrieved November 15, 2013.
- ^ Brasse, Jonathan (13 September 2024). "Lone Star starts LSREV VII investing with 580mUK portfolio deal". PERE.
- ^ a b c Barreto, Sergio (3 July 2024). "Lone Star closes latest opportunistic fund at $5.3bn". Alternatives Watch.
- ^ "Lone Star Value-Add Fund I, L.P." Formsds. August 6, 2020. Retrieved December 1, 2021.
- ^ a b "Lone Star closes 6th commercial real estate fund at $4.7B". S&P Global. June 24, 2019. Retrieved December 1, 2021.
- ^ a b "Lone Star Funds Raises $8.2bn". Private Equity International. February 19, 2019. Retrieved December 1, 2021.
- ^ Peter Flanagan (April 26, 2015). "Lone Star aims for more deals in Europe". Irish Independent.
- ^ Steve Gelsi (January 5, 2015). "Lone Star's first home mortgage fund beats $1 bln target". Buyouts Insider. Retrieved December 1, 2021.
- ^ Timothy Pollard (January 6, 2015). "Largest closed-end, private real estate funds raised in 2014". Pensions & Investments.