Ares and GE agree €170m unitranche deal

The pair’s joint venture has agreed its fourth deal, prodividing a unitranche package to Astorg-owned pharmaceutical group Ethypharm.

GE Capital and Ares Management have together arranged a €170 million senior unitranche facility for Ethypharm, a business owned by French buyout firm Astorg Partners. The facility will be used to refinance existing debt and finance bolt-on acquisitions, the lending pair said in a statement.

The deal is the fourth to be agreed by GE and Ares’ joint venture, known as the European Senior Secured Loan Programme (ESSLP). The €1.75 billion vehicle provides flexible unitranche financing to European mid-market companies, and has deployed more than €500 million over the last 12 months, the firms said.

The Ethypharm deal is ESSLP’s first in France. The financing illustrates many of the strengths of a unitranche package, including speed and ease of execution, and certainty of financing for future deals. Borrowers usually pay a premium for these advantages however. Exact terms of the deal were not disclosed. 

Camille Frizon de Lamotte, executive director at GE Capital, explained: “We were able to add value through speed of execution and lower cost compared to a classic senior / mezzanine structure, and also provided undrawn facilities to the company.”

Ares director Aurélien Loszycer added: “This investment illustrates our ability to swiftly deliver flexible financing solutions and follow-up investments to growing companies. We have been able to structure and pre-agree to all necessary financings for bolt-on acquisitions, allowing Ethypharm to execute its strategic shift into the specialty pharmaceutical field.”