Antares restarts unitranche partnership with Lone Star

The Middle Market Growth Programme that Antares used to manage with Lone Star Funds as part of GE Capital has been resurrected under CPPIB.  

Antares Capital, the US mid-market lender owned by Canada Pension Plan Investment Board (CPPIB), has revived its unitranche lending partnership with Lone Star.

The Middle Market Growth Programme (MMGP), which Antares used to manage under GE Capital with LStar Capital, a Lone Star affiliate, has been relaunched under CPPIB’s ownership. The duo will provide unitranche loans across a range of industries to US companies.

The partnership was originally launched in 2014, when Antares was part of GE Capital, and like the SSLP partnership with Ares Capital, was discontinued when Antares was sold to CPPIB in August.

Antares has bought back its original portfolio of loans from GE, said Tim Lyne (pictured), senior managing director at Antares. The MMGP portfolio typically housed smaller loans than the SSLP and Lyne said it made more sense to move forward with one unitranche partnership.

“The SSLP was for larger credits and the MMGP was for smaller credits, we looked at it and said we should have one programme for small deals and big deals,” Lyne told PDI. The MMGP partnership will extend loans of up to $350 million.

“The goal is that this is our primary unitranche vehicle going forward,” Lyne said.

Lyne declined to share the value of the existing portfolio, though a statement from Antares said it had closed 11 financings with eight private equity sponsors since its launch in 2014. The platform will lend across industries, as it did previously, with the only difference being that healthcare will be added to the mix.

When Antares was part of GE Capital, healthcare finance was executed by a different branch of GE.

“We think having the joint venture with Lone Star makes it more powerful, where we have another strategic partner that has been very successful in private equity. We’ve had the programme with them before, so the idea of continuing on with them is very logical,” Lyne said.

Lone Star’s LStar Capital typically deals in second lien and mezzanine direct lending and will continue to underwrite such deals as part of the unitranche partnership with Antares.

“Borrowers appreciate having a one-stop source of financing,” said Brian Gerson, managing director of LStar Capital, in a statement. “Together with Antares, our combined resources bring a highly differentiated level of industry insight, creativity and certainty of execution to every transaction.”

Lone Star is headquartered in Dallas, with additional US offices in New York and Washington, D.C. The firm has seven additional offices across the Europe, Asia and Canada. Lone Star has $60 billion in assets under management across a variety of private equity, credit and real estate funds. The firm is in the process of raising money for its fifth real estate fund, as PDI reported last month.

Antares focuses exclusively on North American sponsor-backed transactions. The firm is headquartered in Chicago, with additional outposts in Atlanta, Los Angeles, New York, Norwalk, Connecticut; and Toronto. Antares has provided over $120 billion in financing to borrowers over the past five years.

Antares also announced today (13 January) that it hired four people to lead its finance, human resources, information technology (IT) and legal functions. Mary Cecola has come on board as chief information officer, Bruce Frank as general counsel, Barry Giarraputo as chief financial officer and Lisa Jablonski as managing director and head of human resources.