Bank of America's midmarket private equity group is now Ridgemont Equity Partners, an independent firm.
The entire 19-member team from BofA will go to Ridgemont, which will continue managing the bank's $1.5 billion legacy portfolio. That amounts to about 23% of BofA's private equity portfolio as of June. 30. The new firm will be employee owned.
Ridgemont will invest in middle-market buyout and growth equity investments of $25 million to $100 million, said Travis Hain, Ridgemont partner.
Bank of America has been the team's sole limited partner for 18 years and has given Ridgemont a “meaningful amount of capital” as seed money, Mr. Hain said in an interview.
Ridgemont will start raising a new fund next year, which will be the team's first with third-party investor capital. The team expects to close the fund in 2012, but will use Bank of America's seed capital to make investments until then. Those investments will then be contributed to the new fund.
The details of Bank of America's seed capital contribution and terms of the deal are not being disclosed.