Boston, MA, July 21, 2004 NewStar Financial, Inc., a Boston-based commercial finance company, announced today that it has raised $660 million in capital to provide financing to mid-sized corporations, commercial real estate borrowers and issuers of asset-backed securities. The financing consists of $210 million of equity and $450 million of debt. Capital Z Financial Services Fund II, L.P. (“Capital Z”) and JP Morgan Corsair II Capital Partners, L.P. (“JP Morgan Corsair”) sponsored the formation of NewStar and led the Company’s equity financing, with additional commitments provided by other leading institutional investors and management. Wachovia Capital Markets will lead NewStar’s debt financing with CDC IXIS Capital Markets.
The Company will originate senior and subordinated debt financings through a direct calling effort, often in conjunction with other lenders, including commercial banks and finance companies.
“NewStar will target three large, high-growth middle market sectors. We will provide capital directly to our customers and as a value-added partner to a borrower’s existing lender,” stated Timothy J. Conway, Chief Executive Officer of NewStar. “We anticipate providing up to $5 billion of capital to our customers over the next five years. Our first loan is set to close next week and we have over a dozen more in the credit approval process.”
Mr. Conway, formerly a senior executive with Citigroup and FleetBoston, and Chief Investment Officer Peter Schmidt-Fellner, a founder and former Co-Head of the High Yield Group at JP Morgan Chase, will lead the firm. Mr. Conway and Mr. Schmidt-Fellner were previously colleagues at Citigroup.
About NewStar Financial, Inc.:
NewStar Financial, Inc. was formed in June 2004 by a group of senior banking and capital markets executives from leading financial institutions, including FleetBoston Financial, Citigroup and JP Morgan Chase, and leading institutional investors including Capital Z Partners, JP Morgan Corsair Capital Partners and Och-Ziff Capital Management Group. NewStar is focused exclusively on providing customized financing solutions to mid-sized borrowers in three lending groups: Middle Market Corporate, Commercial Real Estate, and Structured Products. For more information, please contact the appropriate individual below.
Gaffney Bennett Public Relations