Former BDCA President Launches New Alt Firm and BDC
Flat Rock Global, a new alternative asset management firm launched by industry veterans Robert Grunewald and Richard Petrocelli, will focus on developing yield-driven investment strategies in sectors deemphasized by banks, the company said. The firm’s initial fund, Flat Rock Capital, will be a private business development company focused on investing in first lien, senior secured debt of middle market companies.
“We believe middle market debt provides investors with access to a unique asset class consisting of floating rate, senior secured investments that can generate higher yields, yet lower losses than high-yield debt or broadly syndicated loans,” said Grunewald, CEO and founder of Flat Rock.
He added, “Retail investors deserve the right to access this unique asset class in the same manner as institutional investors; with no load and no sales commission. Our single institutional-style share class means a dollar invested in Flat Rock Capital becomes a dollar invested in the fund.”
Grunewald has more than 25 years of experience with middle market finance, BDCs and asset management. Within the finance industry, he has participated as a lender, investment banker, M&A advisor, private equity investor and hedge fund manager.
He was most recently the former president and chief investment officer of Business Development Corp. of America, a non-traded BDC sponsored by AR Global. Previously Grunewald headed the financial services investment banking group at Wells Fargo Securities (formerly Wachovia Securities) and later led the financial services investment practice at American Capital.
Richard Petrocelli will serve as Flat Rock Global’s chief operating officer. He has 20-plus years of experience with middle market finance, BDCs and private equity. Within the leveraged finance industry, he has underwritten and structured middle market loans as both a lender and a private equity investor. He has served as the chief financial officer of three business development companies: Saratoga Investment Corp., Fifth Street Finance Corp., and Fifth Street Senior Floating Rate Corp. At Saratoga, Petrocelli also served on the investment committee and was the firm’s chief compliance officer.
Flat Rock Capital will be offered through the registered investment advisor channel with a no-load, institutional-style share class that is available to retail investors.
