  The supergravity dual to N regular and M fractional D2-branes on the cone
over \mathbb{CP}^3 has a naked singularity in the infrared. One can resolve
this singularity and obtain a regular fractional D2-brane solution dual to a
confining 2+1 dimensional N = 1 supersymmetric field theory. The confining
vacuum of this theory is described by the solution of Cvetic, Gibbons, Lu and
Pope. In this paper, we explore the alternative possibility for resolving the
singularity - the creation of a regular horizon. The black-hole solution we
find corresponds to the deconfined phase of this dual gauge theory in three
dimensions. This solution is derived in perturbation theory in the number of
fractional branes. We argue that there is a first-order deconfinement
transition. Connections to Chern--Simons matter theories, the ABJM proposal and
fractional M2-branes are presented.
