Fifth Street Finance Upsizes Kemper Joint Venture
Fifth Street Finance announced an increase in the commitment to Senior Loan Fund JV I, its joint venture with Trinity Universal Insurance, a subsidiary of Kemper. As a result of upsizing the joint venture, the commitment from both FSC and Kemper doubled to $200 million from $100 million. FSC will continue to own 87.5% of SLF JV I alongside a 12.5% contribution from Kemper.
Inclusive of its initial funding in July 2014, SLF JV I invested $179.3 million in a range of one-stop and senior secured loans to 20 portfolio companies. The diversified group of assets, sourced through Fifth Street Management’s origination platform, is funded with leverage provided by Deutsche Bank AG, New York Branch with a ratio of approximately two times debt-to-equity.
“The expansion of SLF JV I further demonstrates the strength of FSC’s long-standing relationship with the investment team at Kemper. The additional capacity allows FSC to continue leveraging the Fifth Street origination platform to provide an array of financing solutions to support the needs of our private equity clients,” stated FSC’s CEO, Leonard M. Tannenbaum, adding, “Growing SLF JV I and other similar joint ventures should be a key component in driving future earnings growth. I am pleased that FSC is generating a mid-teens return on its investment in SLF JV I.”
“Funding the joint venture’s initial portfolio of attractively structured high-yielding investments in a timely manner gave us the confidence to double our commitment to the joint venture with FSC. We have expanded our investment partnership several times during our eight-year relationship, as the Fifth Street platform continues to prove its position as one of the more experienced originators, underwriters and managers of middle market credits,” commented John M. Boschelli, Kemper’s chief investment officer, adding “We look forward to our continued partnership with FSC.”
Kemper is a national insurer.