U.S. private equity fund Lone Star lays off majority of Asia staff -sources

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HONG KONG / NEW YORK – Texas-based private equity firm, Lone Star Funds, has laid off the bulk of its investment team in Asia outside of Japan to pull out of the region, three people familiar depending on the situation told Reuters.

The company has allowed about 25 investment professionals in its mainland China, Hong Kong, India offices said on July 8, effective immediately, two people who spoke on condition of anonymity said due to sensitivity. of the problem.

Residents make up nearly 60 percent of the total workforce at the affected offices, one of the people said.

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These people said the withdrawal was mainly because the company did not find many investment opportunities in Asia outside of Japan.

It comes at a time when private equity in the region hit a record high of $384.9 billion in June, according to data provider Preqin, with companies, according to data provider Preqin. Global and local raise capital like never before, and show that some of them are struggling to raise capital to work due to increasing competition and regulatory uncertainty.

Lone Star, which is primarily focused on troubled opportunities, has retained a small number of wealth management staff in its Asia offices who manage the company’s current portfolio, they said.

They say a full pullback will occur after the company removes all of its investments in the region.

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A spokesperson for Lone Star referred to the company’s announcement on July 8 about the consolidation and reorganization of its global business in Asia. Under the new structure, Donald Quintin and André Collin, who are in charge of corporate opportunity funds and commercial real estate funds in Europe and the Americas, will assume responsibility for Asia.

In that announcement, Lone Star said it had made other changes to streamline its operations in Asia and realign its staffing levels in the region, without elaborating.

The spokesperson declined to comment further.

Lone Star, first established in 1995, has only located its Asia office outside Japan in recent years with a regional headquarters in Hong Kong, one of them said. It manages three types of funds – commercial real estate funds, opportunity funds, and US residential mortgage funds.

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It raised $4.6 billion in the Lone Star Global Real Estate Fund VI and $8.1 billion in the Lone Star XI Fund in 2019. Most recently, it closed a value-added fund. $759 million in August 2020, according to the company’s website.

In an internal July 9 email seen by Reuters, Lone Star President and Chief Legal Officer Bill Young also announced the company’s former Asia President Tony Messina would take on a new role as chief executive officer. senior manager, initially, on his commercial real estate background.

Young did not mention the layoffs or the reasons behind the reshuffle in the email. (Reporting by Kane Wu in Hong Kong and Chibuike Oguh in New York; Editing by Sumeet Chatterjee and Muralikumar Anantharaman)

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https://financialpost.com/pmn/business-pmn/u-s-private-equity-fund-lone-star-lays-off-majority-of-asia-staff-sources-2 | U.S. private equity fund Lone Star lays off majority of Asia staff -sources

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