Ares Management closed its inaugural, commingled U.S. senior direct lending fund, Ares Senior Direct Lending Fund (SDL), with approximately $3 billion in total commitments, a significant oversubscription of its initial $2 billion target in L.P. commitments. Including anticipated leverage, the total capital for SDL is expected to be approximately $5 billion.
The Fund is a natural extension of Ares’ longstanding investment strategy of offering institutional and retail investors access to senior secured, directly originated loans to North American middle market companies through a variety of vehicles.
SDL will provide senior secured loans to defensively-positioned companies in a private, commingled fund format. It attracted a broad and diverse group of investors, including 21 investors new to Ares. Ares also benefited from 24 existing Ares investors committing to the Fund.
“We greatly appreciate the strong support from both existing and new investors, and their confidence in Ares’ leading direct lending platform,” said Kipp deVeer, partner and head of the Ares Credit Group. “SDL has already started to benefit from the team’s significant investment activity, having committed to more than 20 investments to date representing over $700 million of initial commitments since the first closing in July of 2018.”
Mark Affolter, partner and co-head of U.S. Direct Lending, added, “Based on recent volatility, we are seeing improving market conditions to invest in high-quality, senior secured loans with attractive pricing and terms. Our significant capital availability, deep and longstanding relationships and market-leading position with middle market sponsors and management teams provides significant advantages during times of market uncertainty.”
As of September 30, 2018, the Ares Credit Group manages $60.4 billion in global direct lending assets under management, with $39.2 billion in the U.S. and $21.2 billion in Europe. Ares has one of the largest global direct lending teams, with over 170 investment professionals in 12 offices throughout the U.S. and Europe.
