Cerberus Capital management, whose prior fundraising efforts was marred by a national tragedy, is undertaking its first major effort to raise capital in two years, as reported by Reuters.
The new fund will focus on holdings that have high risk and rewards, such as distressed loans and assets in undervalued companies. In its last round, controversy arose when one of its investments, Freedom Group, was found to have been the producer of the Bushmaster rifle that Adam Lanza used to kill 20 children and 6 adults in the 2012 Sandy Hook Elementary school shooting.
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Cerberus Institutional Partners, the new fund, has a target of $3 billion to $3.5 billion and is capped out at $4 billion. The round of fundraising was almost completed for the previous fund, but partly because of the fallout from the school shooting, it raised only $2.6 billion, far behind the target of $3.7 billion. Cerberus was founded in 1992, and recently was involved in the $9.2 billion merger between Albertsons and Safeway. Other holdings include Seibu, a Japanese railroad and YPLLC, which owns the yellow pages. The fund has been successful, recently returning nearly 30%.