Cypress Group
Encyclopedia
The Cypress Group is a private equity
company focused on leveraged buyout
investments in companies across a range of industry sectors. At its peak in the late 1990s and early 2000s, Cypress was among the largest US private equity firms although by the end of the decade the firm would find itself in the process of winding down its operations.
The firm, based in New York City
, was founded in 1994 by the four senior members of Lehman Brothers
' merchant banking group, Jim Stern, Jeff Hughes, Jamie Singleton and David Spalding.
Cypress has raised approximately $3.6 billion since its inception across two funds raised in 1996 and 1999.
' merchant banking group. The four founders were responsible for restarting Lehman's merchant banking efforts after the departure of Pete Peterson
and Stephen A. Schwarzman
to found The Blackstone Group, a private equity and investment banking firm.
The Cypress Group raised its first institutional private equity fund in 1996 with $1.05 billion of investor commitments.
In 1999, the firm completed fundraising for Cypress Merchant Banking Partners II, with $2.5 billion of investor commitments. At the time it was raised, the firm's new fund ranked among the largest raised for leveraged buyout transactions. Ultimately, Cypress II would prove to be the firm's final fund when it announced in 2007 that it would abandon further plans to raise a successor fund.
Cypress had indicated its intentions to raise $1.5 billion. However, a series of weak investments, particularly in Cypress II, severely impacted the firm's plans to raise a third fund. By 2007, Cypress had lost a significant number of its senior investment professionals. As of 2009, the firm is still managed day-to-day by two of its original founders, Jim Stern and Jeff Hughes. David Spalding assumed a role at his alma mater Dartmouth College
and Jamie Singleton still remains on the firm's board.
In October 2009, the firm's Cypress Merchant Banking Partners II will reach the end of its original 10-year term. While the firm is seeking to extend the life of the fund, investors in the fund are currently negotiating an orderly wind-down of the investments in the portfolio.
Among the firm's notable investments include:
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
company focused on leveraged buyout
Leveraged buyout
A leveraged buyout occurs when an investor, typically financial sponsor, acquires a controlling interest in a company's equity and where a significant percentage of the purchase price is financed through leverage...
investments in companies across a range of industry sectors. At its peak in the late 1990s and early 2000s, Cypress was among the largest US private equity firms although by the end of the decade the firm would find itself in the process of winding down its operations.
The firm, based in New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
, was founded in 1994 by the four senior members of Lehman Brothers
Lehman Brothers
Lehman Brothers Holdings Inc. was a global financial services firm. Before declaring bankruptcy in 2008, Lehman was the fourth largest investment bank in the USA , doing business in investment banking, equity and fixed-income sales and trading Lehman Brothers Holdings Inc. (former NYSE ticker...
' merchant banking group, Jim Stern, Jeff Hughes, Jamie Singleton and David Spalding.
Cypress has raised approximately $3.6 billion since its inception across two funds raised in 1996 and 1999.
History
The Cypress Group was founded in 1994 by Jim Stern, Jeff Hughes, Jamie Singleton and David Spalding who had served previously as the senior managing directors of Lehman BrothersLehman Brothers
Lehman Brothers Holdings Inc. was a global financial services firm. Before declaring bankruptcy in 2008, Lehman was the fourth largest investment bank in the USA , doing business in investment banking, equity and fixed-income sales and trading Lehman Brothers Holdings Inc. (former NYSE ticker...
' merchant banking group. The four founders were responsible for restarting Lehman's merchant banking efforts after the departure of Pete Peterson
Peter George Peterson
Peter G. Peterson is an American businessman, investment banker, fiscal conservative, author, and politician whose most prominent political position was as United States Secretary of Commerce from February 29, 1972, to February 1, 1973 under Richard Nixon. He is most well known currently as...
and Stephen A. Schwarzman
Stephen A. Schwarzman
Stephen Allen Schwarzman is an American businessman and investor and the chairman and co-founder of the Blackstone Group, the private-equity and financial advisory firm.-Early life and education:...
to found The Blackstone Group, a private equity and investment banking firm.
The Cypress Group raised its first institutional private equity fund in 1996 with $1.05 billion of investor commitments.
In 1999, the firm completed fundraising for Cypress Merchant Banking Partners II, with $2.5 billion of investor commitments. At the time it was raised, the firm's new fund ranked among the largest raised for leveraged buyout transactions. Ultimately, Cypress II would prove to be the firm's final fund when it announced in 2007 that it would abandon further plans to raise a successor fund.
Cypress had indicated its intentions to raise $1.5 billion. However, a series of weak investments, particularly in Cypress II, severely impacted the firm's plans to raise a third fund. By 2007, Cypress had lost a significant number of its senior investment professionals. As of 2009, the firm is still managed day-to-day by two of its original founders, Jim Stern and Jeff Hughes. David Spalding assumed a role at his alma mater Dartmouth College
Dartmouth College
Dartmouth College is a private, Ivy League university in Hanover, New Hampshire, United States. The institution comprises a liberal arts college, Dartmouth Medical School, Thayer School of Engineering, and the Tuck School of Business, as well as 19 graduate programs in the arts and sciences...
and Jamie Singleton still remains on the firm's board.
In October 2009, the firm's Cypress Merchant Banking Partners II will reach the end of its original 10-year term. While the firm is seeking to extend the life of the fund, investors in the fund are currently negotiating an orderly wind-down of the investments in the portfolio.
Investments
Since inception in 1994, Cypress has invested more than $4 billion of equity in more than 30 companies through transactions totalling in excess of $22 billion in size. Historically, Cypress employed an industry-based investment strategy and the firm was structured into six industry groups covering large segments of the economy, including:- Packaging, Building Products, Construction Materials & Retail
- Automotive & Aerospace/Defense
- General Industrial & Services
- Healthcare & Financial Services
- Media & Entertainment, Lodging & Leisure
- Consumer Products
Among the firm's notable investments include:
- Affinia GroupAffinia GroupThe Affinia Group, a motor industry company, was formed in 2004 and specializes in the design, manufacture and replacement of parts for and on and off-road vehicles...
- Amtrol
- Catlin GroupCatlin GroupCatlin Group Limited is a Bermuda-based specialty insurance and reinsurance company. Catlin operates six underwriting hubs worldwide and operates nearly 50 offices. It owns the largest syndicate at Lloyd's of London, based on 2009 gross written premiums. Catlin shares are listed on the London...
- Cinemark TheatresCinemark TheatresCinemark Theatres is a chain of movie theatres owned by Cinemark Holdings, Inc. in North and South America and Taiwan. It has its headquarters in Plano, Texas.Cinemark's Missions Statement Reads as follows:...
- Cooper Standard
- Financial Guaranty Insurance CompanyFinancial Guaranty Insurance CompanyFinancial Guaranty Insurance Company is a monoline bond insurer established in 1983. It faced significant financial difficulties in 2008 which affected its ability to write new business....
- Frank's Nursery & CraftsFrank's Nursery & CraftsFrank's Nursery & Crafts was a United States retailer devoted to the sale of lawn and garden products. It operated a chain of stores, with 170 outlets across 14 states...
- Infinity Broadcasting CorporationInfinity Broadcasting CorporationInfinity Broadcasting Corporation was a radio company that existed from 1972 until 2005. It was founded by Michael A. Wiener and Gerald Carrus. It became associated with popular radio personalities like Howard Stern, Don Imus and Mike Francesa. Infinity merged with CBS Corporation in 1997 and later...
- Lear Corporation
- Loral Aerospace HoldingsLoral Space & CommunicationsLoral Space & Communications Inc. is a satellite communications company headed by Michael B. Targoff and incorporated in Delaware. The company was formed in 1996 from the remnants of Loral Corporation when Loral divested its defense electronics and system integration businesses to Lockheed Martin...
- McBride plcMcBride plcMcBride plc is a leading British-based manufacturing business specialising in household and personal care products. It is listed on the London Stock Exchange and is a constituent of the FTSE SmallCap Index.-History:...
- Meow MixMeow MixMeow Mix is a variety of dry and wet cat food known for its advertising jingle. It is a product of Del Monte Foods.-Company background:The Meow Mix Company operates from a facility in Decatur, Alabama, and also produces Alley Cat brand cat food products. Originally a product of Ralston Purina,...
- R.P. Scherer Corporation
- Republic National Cabinet Corporation
- Scottish Re Group
- WESCO InternationalWESCO InternationalWESCO International, Inc. is a holding company for WESCO Distribution, a multinational electronics distribution and services company based in Pittsburgh, Pennsylvania.-History:...
- Williams Scotsman
External links
- The Cypress Group (company website)