Ares Management Corporation, a global alternative investment manager, has closed its sixth commingled European direct lending fund – Ares Capital Europe VI (ACE VI) – with total commitments of €17.1bn, closing above its €15bn target, making it the largest institutional fund in the global direct lending market to date, according to the firm.

The final fund size represents an approximate 53% increase in LP commitments relative to its predecessor fund, Ares Capital Europe V, which closed in 2021 at its €11.1bn hard cap, Ares said.

Including related vehicles and anticipated leverage, the total available capital for the Ares European Direct Lending strategy is expected to be approximately €30bn.

Combined with the previously announced $33.6bn of total capital raised for its Senior Direct Lending Fund III (SDL III), inclusive of related vehicles and anticipated leverage, Ares has closed on approximately $64.5bn across its SDL III and ACE VI strategies – cementing its global market leadership.

“The final closing of ACE VI underscores the strength of Ares’s European direct lending platform as well as the strong demand from borrowers for flexible capital solutions,” said Blair Jacobson, partner and co-head of European credit.

Michael Dennis, partner and co-head of European credit, added: “Over the past 18 years, we have continued to demonstrate our market leadership through our local pan-European approach.”

He noted that the firm’s “deep regional and sector experience, alongside our longstanding sponsor and partner relationships, enable us to originate significant opportunities with high-quality borrowers”.

Matt Theodorakis, partner and co-head of European direct lending at Ares, said the platform “provides the scale, experience and innovation to identify new opportunities and navigate unexpected challenges”.

Ares’s European direct lending strategy comprises approximately 90 investment professionals across London, Paris, Frankfurt, Stockholm, Amsterdam and Madrid, and manages over $74bn in assets, inclusive of the ACE VI commitments.

Since its inception, the European direct lending business has completed nearly 380 investments totalling over €70bn.

ACE VI seeks to self-originate flexible financing solutions for high-quality, market-leading European companies in defensive industries with EBITDA in excess of €10m. The fund targets a senior-secured weighting and focuses on capital preservation, a sole or lead lender position, and low volatility. ACE VI has already deployed significant capital, committing roughly €6.4bn across more than 50 investments to date.

Read the digital edition of IPE’s latest magazine

 

Topics