Exclusive: European Capital raising debut DL fund

 The American Capital subsidiary will use the funds to make mid-market loans in Europe.  

European Capital is seeking €500 million for its first mid-market direct lending fund, according to a source close to the situation. The firm has invested in European mid-market debt since 2005 using capital from its parent, American Capital.

The firm is moving towards a close on the vehicle, the source added, declining to disclose whether prior interim closes have already occurred. The European Capital Private Debt Fund will invest on a pan-European basis in senior, unitranche and mezzanine debt. The firm closed its £100 million debut UK SME debt fund in 2014. It has offices in London and Paris and €900 million in assets under management.

American Capital originates, underwrites and manages investments in mid-market private equity, leveraged finance, real estate, energy & infrastructure and structured products. The firm has $23 billion in assets under management. The firm and its affiliates invest $10-$600 million per company in North America and €10- €300 million per company in Europe, according to its website.

The asset manager is publicly traded on the NASDAQ stock exchange. Since its August 1997 IPO, the firm and its funds have invested about $37 billion in 730 portfolio companies across the industry spectrum.

American Capital manages three public companies and BDCs: the American Capital Agency Corp. (Nasdaq: AGNC), American Capital Mortgage Investment Corp. (Nasdaq: MTGE) and American Capital Senior Floating (Nasdaq: ACSF) with approximately $11 billion of net book value.