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Ares Management Corporation Closes Oversubscribed Second Junior Capital Direct Lending Fund
Rhea-AI Impact
(Low)
Rhea-AI Sentiment
(Positive)
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Rhea-AI Summary
Ares Management Corporation (NYSE: ARES) has successfully closed its Ares Private Credit Solutions II (APCS II) fund, achieving commitments of $5.1 billion, surpassing its $4.0 billion target. This fund is about 50% larger than its 2017 predecessor, providing tailored junior capital financing for upper middle market companies. With approximately $69 billion in assets under management, Ares aims to leverage its extensive experience and robust networks to deliver strong risk-adjusted returns, having already invested 20% across nine portfolio companies.
Positive
APCS II closed at $5.1 billion, exceeding the $4.0 billion target.
The fund is approximately 50% larger than the previous fund established in 2017.
Already 20% of the fund has been invested across nine portfolio companies.
Ares has $69 billion in assets under management, enhancing its investment capabilities.
Negative
None.
$5.1 Billion Final Close Exceeds $4.0 Billion Target
LOS ANGELES--(BUSINESS WIRE)--
Ares Management Corporation (“Ares”) (NYSE: ARES), a leading global alternative investment manager, announced today the final closing of Ares Private Credit Solutions II (“APCS II” or the “Fund”). APCS II was oversubscribed with $5.1 billion of commitments compared to its $4.0 billion target and is approximately 50% larger than its 2017 predecessor fund.
Through APCS II, Ares provides tailored junior capital financing solutions to upper middle market companies. The Fund invests primarily in directly originated second lien, mezzanine private high yield debt and preferred equity, and will also participate in common equity co-investments. APCS II seeks to partner with businesses that, among other characteristics, maintain a leading market position, have demonstrated operational excellence, are led by high quality management teams and operate in defensive industries. The Fund is off to a strong start with 20% already invested across nine portfolio companies.
With market leading capabilities across North America, Europe and Asia Pacific, Ares is one of the world’s largest originators of private credit investments. Ares’ U.S. direct lending team, which manages APCS II, has nearly 150 investment professionals across six originating offices and oversees $69 billion of assets under management as of June 30, 2021. The team’s robust sourcing networks, incumbent relationships, structuring expertise, portfolio management and market knowledge are anticipated to be key advantages for APCS II.
“We are grateful for the continued strong vote of confidence from our existing investors and we are pleased to welcome many new investors to our junior capital investment strategy,” said Kipp deVeer, Partner and Head of the Ares Credit Group. “As a pioneer in private credit and a global leader in direct lending, we see significant and growing interest from a range of private equity firms and other corporate owners to partner with Ares to support their investment and business development objectives.”
“APCS II provides our investors access to one of the largest and most consistently performing self-originating direct lenders in the U.S.,” said Michael Smith, Partner and Co-Head of the Ares Credit Group. “Upper middle market businesses are increasingly looking to scaled private credit providers to meet their financings needs. Given our comprehensive offering of solutions and differentiated partnership approach, we look forward to utilizing Ares’ deep credit expertise and scale to support the growth and development of our portfolio companies, all while delivering strong risk adjusted returns for our investors.”
“APCS II has already experienced strong deployment and will employ the same ‘all-weather’ strategy as its predecessor fund,” said Jim Miller, Partner and Co-Head of U.S. Direct Lending at Ares. “Our portfolio construction reflects our fundamental belief that credit selection, sector avoidance and lead investing are the key drivers of constructing defensive investment portfolios and mitigating risk. APCS II is designed to execute on this approach and will seek to deliver attractive returns in both healthy and dislocated market environments.”
APCS II attracted strong support from a broad and diverse group of investors from North America, Europe, Asia and the Middle East, with nearly a third of its limited partners new to the Ares platform. The global investor base is comprised of pension funds, sovereign wealth funds, insurance companies, high net worth individuals, family offices, funds-of-funds, endowments and foundations.
About Ares Management Corporation
Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager offering clients complementary primary and secondary investment solutions across the credit, private equity, real estate and infrastructure asset classes. We seek to provide flexible capital to support businesses and create value for our stakeholders and within our communities. By collaborating across our investment groups, we aim to generate consistent and attractive investment returns throughout market cycles. As of June 30, 2021, including the acquisition of Black Creek Group which closed July 1, 2021, Ares Management Corporation's global platform had approximately $262 billion of assets under management, with approximately 2,000 employees operating across North America, Europe, Asia Pacific and the Middle East. For more information, please visit www.aresmgmt.com. Follow Ares on Twitter @Ares_Management.
Ares Credit Group
The Ares U.S. direct lending team is part of the Ares Credit Group, which manages approximately $167 billion in global assets under management, as of June 30, 2021. The Ares Credit Group has over 290 investment professionals with investments in more than 2,900 companies across over 210 funds.
What is the final closing amount for Ares Private Credit Solutions II?
Ares Private Credit Solutions II closed with commitments of $5.1 billion.
How does APCS II compare to its predecessor fund?
APCS II is approximately 50% larger than its predecessor fund from 2017.
What types of investments will APCS II focus on?
APCS II will focus on tailored junior capital financing solutions, mainly investing in second lien, mezzanine debt, preferred equity, and co-investments.
What percentage of APCS II has already been invested?
Currently, 20% of APCS II has been invested across nine portfolio companies.
How much assets does Ares Management oversee?
As of June 30, 2021, Ares Management oversees approximately $69 billion in assets under management.
