| NEW YORK, Sept 30
NEW YORK, Sept 30 Investment firm TCW has
acquired private equity firm Craton Equity Partners in a push to
expand its alternative offerings, the head of the firm's
alternative products division said Monday.
The firm aims to acquire one more alternative vehicle this
year, and continue to acquire four or five alternative vehicles
annually for the "foreseeable future," said Jess Ravich, group
managing director and head of alternative products at TCW, in an
"Right now, we're drafting for talent," said Ravich. "The
world's pretty open in terms of what we're looking to add," he
said. Los Angeles-based TCW Group Inc has over $130 billion in
Alternative investments differ from traditional investments
such as stocks and bonds and may include hedge funds, private
equity, venture capital, and mezzanine debt.
TCW's most recent prior acquisition was in December 2012,
when the firm bought Boston-based asset manager Regiment Capital
Advisors's Special Situations Funds group. TCW's alternative
products group had $8.5 billion in assets as of June 30.
Ravich said that alternative vehicles have become more
appealing to institutional investors given low interest rates,
as well as the risks of investing in stocks, which became clear
during events like the 2008 financial crisis.
Craton invests mainly in companies that focus on
sustainability, resource efficiency, and carbon-reducing
technology. The firm was founded in 2006 and has $241.5 million
Ravich said that TCW is poised to benefit from the drop in
demand for sustainable businesses in recent years.
"There's less money looking at better and more seasoned
deals," he said. "We think we can return outsized returns to our
investors because of that dynamic," he added.
Craton Equity co-founders and managing partners Bob
MacDonald and Tom Soto will become managing directors within
TCW's alternatives group. Ravich said no investment banks have
been involved in TCW's alternative products group's
Private-equity group Carlyle completed its
acquisition of TCW in February. The firm was formerly owned by
French bank Societe Generale.