James Zenni’s Z Capital Group LLC, an investment firm focused on private equity and credit wagers, is exploring strategic options including the sale of a minority stake, according to a person with knowledge of the matter.
Z Capital is in preliminary talks with potential investors on a stake sale that could value the firm at $1 billion or more, said the person, who requested anonymity discussing a private matter. The New York-based firm is working with an adviser to solicit interest, and may use proceeds to seed new funds and expand employee ownership, the person said.
A Z Capital representative declined to comment.
Z Capital has more than $5 billion in assets under management, its website shows. The firm’s private equity platform has invested in sectors including restaurants, gaming, hospitality, manufacturing, media and business services, while its credit arm invests across leveraged loans, opportunistic and distressed credit and other private debt. It has made bets on companies including Mrs. Fields, Bayou Steel Corp. and Twin Star Home, and separately operates technology and consulting platforms.
Firms including Blackstone Inc., Blue Owl Capital Inc.’s Dyal Capital and Petershill Partners Plc have raised billions of dollars to buy minority stakes in investment firms. Alternative-asset managers with private equity and credit offerings that have sold minority stakes include H.I.G. Capital, Littlejohn & Co. and New Mountain Capital.