Asset manager SoundPoint agreed to buy the U.S. direct lending arm of CVC, according to a person familiar with the matter, extending a spate of consolidation in direct lending
Alternative asset manager SoundPoint Capital Management LP has struck a deal to buy the U.S. direct lending arm of CVC Capital Partners , according to a person familiar with the matter.
The expected purchase would triple the size of SoundPoint’s direct-lending assets to about $1.5 billion, helping the New York-based firm to penetrate the burgeoning market for private credit. Luxembourg-based CVC is selling about $1 billion of loans it made to small and medium-size U.S. companies and a nine-member investment team led by Thomas Newberry and David DeSantis. The firm, which is best known for its $89 billion private-equity business, expanded into U.S. direct lending about five years ago byPrivate debt investing by nonbank institutions is booming, hitting almost $1 trillion in assets in September compared with $264 billion in 2009, according to data from Preqin.
The flood of money sparked worries of excessive risk taking and losses in economic downturns but the burgeoning asset class . An index of direct-lending funds returned 5.45% in 2020, according to data from Cliffwater LLC, and direct-lending funds have raised or are slated to raise about $44 billion in 2021, according to data from Preqin.
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