Exclusive: Riverside poaches VSS ‘structured capital’ team

September 23, 2013, 7:43 PM UTC

FORTUNE — Private equity firm The Riverside Company has quietly hired five members of the “structured capital” team at Veronis Suhler Stevenson, Fortune has learned.

The quartet will be charged with raising a new family of funds that will provide non-control junior capital to small and profitable companies in the U.S. and Europe. This would be Riverside’s fifth family of funds, and its first to not focus on buyouts. The New York-based firm currently has over $3.5 billion in capital under management, all of which has been aimed at businesses with enterprise values below $250 million.

The new team members are: Managing partners George Cole and Hal Greenberg, partner Michael Kessler, principal Jeffrey Gordon and vice president Jay Reynolds.

That’s the same group that was helping to manage a pair of structured credit funds for VSS, including a $350 million vehicle closed in 2007. No word yet on what happens to the underlying portfolios, or if any keyman triggers needed to be resolved.  David Bainbridge, a co-manager of the group alongside George Cole, is remaining with VSS.

A Riverside spokesman confirmed the hires, while VSS has not returned a request for comment.

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