ICG corrals $400m for senior debt in Australia

The mezzanine specialist sees opportunities in the space as the bank squeeze continues.

Intermediate Capital Group (ICG) has collected around $400 million for IC Australia Senior Loan Fund at its first close.

The fund was launched in 2013 with a focus on senior debt opportunities in mid-market companies and private equity transactions in Australia and New Zealand. The fund will avoid real estate, infrastructure or project financing, PDI understands.

The fund has received capital commitment from around 10 investors, predominantly superannuation funds, according to a local news report.

The vehicle is the first Australian senior secured debt fund launched by ICG and will be managed by Matthew Turner, ICG’s head of Australian senior debt. To strengthen the manager’s presence in the market, it also hired Denis Rayel from GE Capital to the Australian senior loans investment team last year.

ICG has traditionally been a mezzanine player in the Australian market. Last year, the firm participated in a syndication to finance Partners Group’s buyout of Guardian Early Learning, a childcare centre owner. The firm also previously invested mezzanine and equity in Link Group, MYOB Holdings and poultry producer Tegel Group in the region.

Recently, more non-bank lenders have been seeing opportunities in the senior debt space with the banks increasingly burdened by capital regulation. MaxCap, a commercial real estate debt specialist, which has also traditionally been a mezzanine lender, launched its first senior debt fund targeting $100 million last year.

ICG’s assets under management crossed £22 billion by the end of last year, in part driven by the notable success of its real estate platform ICG-Longbow IV.