Ares Management closed its fourth European direct lending fund, Ares Capital Europe IV (ACE IV). Within six months of its launch, ACE IV was significantly oversubscribed relative to its initial target of €4.5 billion ($5.268 billion), closing at a hard cap of €6.5 billion ($7.609 billion) in total commitments.

ACE IV is the largest European direct lending fund raised to date and is a significant increase from ACE IV’s predecessor fund, ACE III, which closed in May 2016 at €2.5 billion ($2.927 billion). Including anticipated leverage, the total available capital for ACE IV will be approximately €10 billion ($11.7 billion).

ACE IV attracted backing from a diverse group of more than 125 investors, including 59 investors new to Ares. The investors included pension funds, insurance companies, sovereign wealth funds, endowments, a private banking platform and family offices. Overall, ACE IV received strong support from current investors, with approximately 70% of commitments coming from existing Ares investors. ACE IV will be the first Ares European direct lending fund to offer an unlevered sleeve, a structure that has brought a number of first time investors to the Ares platform.

ACE IV will continue Ares’ strategy of providing flexible, one-stop and scaled capital solutions to mid-market companies across Europe. Ares has one of Europe’s largest dedicated direct lending teams, with more than 40 investment professionals and offices in London, Paris, Stockholm and Frankfurt. The team has invested more than €12 billion ($14 billion) since inception and approximately €4 billion ($4.682 billion) in 25 new platform transactions and 25 add-ons over the last twelve months. ACE IV has already started to use the Ares’ investment pipeline and committed to several investments to date.

“ACE IV’s scale underscores the attractive investment opportunities available in the European market today and the confidence that investors have in Ares as a strong steward of their capital,” said Blair Jacobson, Co-Head of the Ares European direct lending strategy and Partner in the Ares Credit Group. “We are pleased that investors have continued to support our strategy as our deployment has increased over time.”