Ares Capital leads $1bn unitranche financing

The Ares Capital Corporation (ARCC) has bagged its latest largest deal. The BDC is leading a $1.075 billion unitranche credit facility supporting the acquisition of Qlik Technologies by Thoma Bravo. The BDC was the joint lead arranger on the deal with the data analytics company. Other lead joint arrangers included Golub Capital, TPG Special Situations Partners and Varagon Capital Partners. The transaction is expected to close late in the third quarter.

Ares said in a statement that the firm will be holding a significant portion of the loan on its books, though it has not yet provided specifics. The deal marks the largest transaction ever arranged by a BDC. 

Ares’ previously largest deal was its $800 million lead on refinancing of American Seafoods when Bregal Partners took an equity stake in the company last fall. The deal was syndicated out to about 30 other lenders, with Ares holding over $100 million of a first and second lien loan in the company. 

Ares will be leading the syndication process for Qlik Technologies to source other lenders into the credit facility, the firm said in a statement. 

“Leading our industry’s first billion-dollar unitranche financing marks another milestone in the strong and consistent growth of Ares Capital,” Kipp deVeer, ARCC’s chief executive, said in a statement. “Thoma Bravo turned to us for certainty of closing, as well as our scale and experience in closing large transactions at a time when banks continue to retrench from lending to corporate clients due to changes in regulation,” he continued. 

Ares and other large lenders have lately been touting their ability to lead large deals at a time when banks seem to be retrenching more and more from lending. Last week, Ares announced it was acquiring the American Capital BDC in a $3.4 billion deal. After the transaction closes, the combined BDC will have $13 billion in assets, which Ares executives highlighted will further help the firm compete on large deals. 

“This unitranche financing was unprecedented in size and required a quick commitment from Ares and the syndicate,” said Erwin Mock, director of capital markets at Thoma Bravo. “Due to Ares Capital's size and experience, we were confident that we could rely on them to arrange the financing of our acquisition of Qlik in a timely manner.” 

Qlik is a visual analytics company with a portfolio of products that helps businesses analyze data. The company is headquartered in Radnor, Pennsylvania and has offices around the world serving customers in 100 countries. 

The $9 billion Ares Capital is the largest publicly-traded BDC that provides one-stop debt and equity financing to US mid-market companies, venture capital backed businesses and power generation projects. The BDC is part of Ares Management at large, which has a $62 billion credit group that handles direct lending and tradable credit. The overall firm has $93 billion across credit, private equity and real estate.  

Thoma Bravo is a Chicago and San Francisco-based private equity firm. The firm manages a series of funds that have $15 billion in equity commitments.