Blue Torch Capital, the new firm started by mid-market financing veteran Kevin Genda, is on the road with its debut direct lending fund, according to a person familiar with the matter.
The New York-based firm is seeking $750 million for the vehicle, the source said, but could go as high as $1 billion, the source said. The funds are expected to charge a 1 percent management fee on the vehicles’ assets under management and a 15 percent incentive fee over 6 percent hurdle rate, according to documents filed with the US Securities and Exchange Commission.
Blue Torch declined to comment.
Genda, who founded Cerberus Capital Management’s mid-market lending business, Cerberus Business Finance, in the 1990s, launched his new private credit shop after he leaving his old firm in August 2016. He brought on Gary Manowitz, formerly chief accounting officer at HIG Capital’s credit platform, as chief financial officer, according to Manowitz’s LinkedIn profile.
The firm also hired Lee Haspel, previously a portfolio manager at Fifth Street Asset Management; Casey Callahan, formerly of Credit Suisse’s distressed and special situations desk; and Vuk Djunic, who used to be a senior high yield and distressed credit analyst at Sounion Capital, according to their LinkedIn profiles. Kathleen Persaud, previously of Third Avenue Management, is working in the firm’s investor relations department.
During Genda’s time at old firm, Cerberus closed multiple direct lending funds, with the more recent ones including Cerberus Levered Loan Opportunities Fund I and Fund II, which closed on $841 million and $1.5 billion, respectively, according to PDI data.
Cerberus also locked down $300 million separately managed direct lending accounts with the New Jersey Division of Investment and the Pennsylvania Public School Employees’ Retirement System. The firm has also closed multiple mid-market collateralised loan obligations since the global financial crisis.
In March, the firm closed on $2.05 billion for Fund III, which was launched last year. The firm plans to use leverage of 1:1 to 2:1, according to investor documents presented to the North Dakota State Investment Board. The investment period would end by August 2019. Loans Cerberus makes can include a five- to seven-year maturity and a 40-60 percent loan-to-value ratio.