An employee-owned asset manager with $304 billion in AUM is investing in a 12-year-old, technology-focused private equity firm in Silicon Valley.

Michael Rees Dyal Partners/font> Managing Director

Yesterday Michael Rees, head of Dyal Capital Partners confirmed that the New York City-based firm has bought a passive, non-voting, minority stake in Palo Alto, California-based HGGC. Dyal specializes in taking minority stakes in alternative asset managers and is itself a subsidiary of New York City-based asset manager Neuberger Berman [profile].

Evercore advised HGGC on the deal, while Kirkland & Ellis provided legal counsel. Pricing and terms of the deal were not disclosed.

"HGGC has very quickly become a premier middle market investment firm through its 'Advantaged Investing' model that creates true partnerships with founder-owners, management teams and sponsors," Rees states, lauding HGGC's "differentiated approach, the strong and growing team, and the firm's demonstrated commitment through being one of the largest investors across its own funds."

Rich Lawson — chairman, CEO, and co-founder of HGGC — highlights Dygal's "stellar reputation for investing in best-in-class firms." Steve Young, president and co-founder of HGGC, adds that the team looks forwards "to putting this capital to work" in its portfolio.

HGGC has $4.3 billion in cumulative capital commitments, and it has completed more than 120 deals with nearly $20 billion since its launch in 2007.

Dyal, launched in 2011, has completed 40 deals across three funds with about $14.5 billion in AUM, as of November 30, 2018. All of Neuberger had $304 billion in AUM as of December 31. 

Edited by: Neil Anderson, Managing Editor


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