CVC Capital Partners has agreed to combine its existing credit arm CVC Cordatus Group with New York-based Apidos Capital Management, the credit platform of Resource America, to form CVC Credit Partners.
London-based CVC Cordatus was started in 2006 and focuses on sub-investment grade debt capital markets in Europe. The division manages four funds with €1.5 billion of assets under management.
Apidos was formed in 2005 and invests in speculative grade credit, primarily first and second lien loans and high-yield bonds. The group manages approximately $5.8 billion in assets across 16 CLO funds and the Apidos Select Corporate Credit Fund.
CVC Credit Partners will comprise $7.5bn of credit assets across 21 vehicles in the US and Europe. The team will be led CVC managing partner Marc Boughton and senior portfolio managers Gretchen Bergstresser and Jonathan Bowers. Former Apidos chief operating officer Chris Allen will be COO of the new group, and former Apidos CEO Jonathan Cohen will act as CEO.
Resource America, the asset management company with $13.7 billion in assets under management, will retain a 33 percent stake in the newly formed entity. The merger is subject to regulatory and other market consents.
Clifford Chance advised CVC on the transaction. The firm was not available for comment at press time.
The merger will not involve any new hires, as CVC and Apidos will consolidate their existing teams.
“Both teams appreciate the significant benefits of being able to offer sponsors and companies access to a broader range of debt capital to support their businesses and initiatives,” Boughton said in a statement.
The new group “will offer investors access to a broader range of investment opportunities within the US and European credit markets using our combined investment expertise”, Cohen said in the statement.
Credit strategies have become increasingly attractive to private equity shops and their limited partners. Last month, Cerberus Capital Management formed a separately managed account with New Jersey’s $68 billion pension system that will make loans to mid-market companies. The firm has operated in Europe for at least 15 years, but has been growing the platform in the region, according to a statement.