Barings is nearing to a second close of its debut North American-focused senior loan fund that will put the vehicle well over its initial $750 million target, and the firm is still seeking capital.
By the end of April, the asset manager, which oversees $271 billion, is scheduled to have formally locked down around $1 billion for its Barings North American Private Loan Fund, a source familiar with the situation told Private Debt Investor. Barings will likely hit an unspecified hard-cap this summer, this person said.
The Charlotte-based firm declined to comment on the vehicle.
Barings’ North American private credit arm directly originates loans for mid-market companies with annual EBITDA typically in the range of $10 million to $50 million in deals involving a private equity sponsor. Though the PLF will target senior debt, Barings does make investments on the lower end of the capital structure as well.
Interest from limited partners has spanned the globe, this person said, including North America, Europe and a particularly strong interest from Asia, where Barings has already landed investors for previous funds. In June 2016, South Korea’s Public Official Benefit Association committed a total of $100 million to several private debt managers, including Barings, then named Babson Capital Management.
Last year, Barings collected $2 billion for its global lending strategy, that figure consisting of both a commingled fund and separately managed accounts. The pooled fund also had a target of $750 million. Investors for that strategy were also multinational – commitments came from LPs in 11 different countries, as PDI previously reported.
Barings Private Equity Asia is also raising an India-focused debt fund after it acquired Religare Global Asset Management’s credit arm in the world’s second most populous country, PDI reported last month. The target of the fund is set at INR5 billion ($77.02 million; €71.81 million) with a greenshoe option of INR2.5 billion. It is expected to reach a close in the first quarter this year, according to PDI sources close to the matter.
Babson became Barings in September when Massachusetts Mutual Life Insurance Company, of which Babson was an affiliate, integrated Babson and Barings Asset Management, also a MassMutual affiliate. Babson subsidiaries Cornerstone Real Estate Advisers and Wood Creek Capital Management were also included in the integration. The larger entity took the Barings name.
So far, the deals the Barings North American team has closed this year include a debt package – which consisted of a revolving credit facility, term loan and a delayed draw term loan – to back New Heritage Capital’s buyout of Continental Services, a Troy, Michigan-based food management company. – Christie Ou contributed to this report.