Madison Capital, THL Credit back patient loan company

ClearBalance, a California-based portfolio company of Angelo, Gordon & Co., is borrowing $50 million for a dividend recap from the lending duo.  

ClearBalance, a California-based provider of patient loan packages, has completed a $50 million dividend recapitalisation provided by Madison Capital Funding and the THL Credit Logan JV.

The company, which was acquired by private equity firm Angelo, Gordon & Co. in 2012, will use the capital to return dividends to shareholders and to fund further expansion, reports PDI sister publication Private Healthcare Investor.

“ClearBalance has shown tremendous growth since we originally invested in the company in December 2012,” said Art Peponis, head of private equity at Angelo Gordon, in a statement. “The high quality of the company’s value-added product and customer service is reflected in the 60 percent growth in loan volume we have experienced since our original investment.”

Along with providing shareholder dividends, the company plans to use the funds to grow its product offerings and further invest in its investment technology infrastructure.

Madison Capital also provided financing when Angelo Gordon bought ClearBalance. Madison is a division of the New York Life Insurance Company that issues loans to private equity-sponsored companies. The Chicago-headquartered firm has about $7.5 billion in assets under management.

THL Credit, the Boston-headquartered credit arm of Thomas H. Lee Partners, formed a joint venture (JV) with wealth management firm Perspecta Trident in December. The partnership, that was made by THL Credit’s BDC, allows the vehicle to access more leverage (at 2:1, as opposed to 1:1 that BDCs are limited to) and move further up the capital structure, as the THL Credit chief executives told PDI at the time. The firm has $5 billion in assets across its direct lending and tradable credit platforms.

Angelo Gordon has around $27 billion in assets under management and also invests through its debt and real estate vehicles. The firm typically makes private equity investments of between $25 million and $125 million in the financial services and retail sectors. The New York-headquartered alternative investment firm also hired two former Madison Capital executives to start its own direct lending practice, called Twin Brook Capital Partners, last year.

Additional reporting by Anastasia Donde.