Petra leads mezzanine investment in Houston telecom company

Petra Mezzanine Fund, a Small Business Investment Company (SBIC) founded by Petra Capital Partners in December 1999, has closed on its second investment of the year

Petra Mezzanine Fund, a Small Business Investment Company (SBIC) founded by Petra Capital Partners in December 1999, has closed on its second investment of the year.

The Nashville-based fund led an $8 million mezzanine subordinated debt investment in the acquisition of CapRock Services Corp. from McLeodUSA. Houston-based CapRock provides satellite communications services, frequently to the oil and gas industry in the Gulf of Mexico. It specializes in voice, data, fax and video communications for remote locations, such as oil rigs. The company was acquired in 2000 by McLeodUSA, which filed Chapter 11 in January.

Petra invested in the $24 million financing after learning of the opportunity from Genesis Park LP., a Houston private equity firm that, along with The Riverside Company of Cleveland, Ohio, took a controlling equity stake in the newly independent company, according to Petra’s Mike Blackburn.

With the CapRock investment, Petra has deployed $25 million of the mezzanine fund’s $80 million of capital. Earlier this year, Petra supplied capital for Tuscon-based Providence Corporation's acquisition of Camelot Care Corp., a foster care company former Mayor Phil Bredesen co-founded. Blackburn said his firm is reviewing a dozen more investment possibilities, several of which are in the health care sector.

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