Medalist Partners acquires CLO business

The alternative asset manager bought a controlling stake in JMPCA, which manages $1.2bn across three CLOs.

Medalist Partners has taken a controlling interest in JMP Credit Advisors (JMPCA).

New York-based Medalist announced on Wednesday that it purchased a 50.1 percent equity stake in JMPCA, while JMP Group will retain a 45 percent stake in the entity. JMPCA was previously wholly-owned by the firm, and the remaining 4.9 percent will go to JMPCA employees.

The selling firm, which will be renamed Medalist Partners Corporate Finance, currently manages more than $1.2 billion across three separate CLOs.

Medalist Partners had increased some of its funds’ exposure to the CLO market at the end of 2018, Michael Ardisson, a partner, chief operating officer and head of business development at the firm, told Private Debt Investor. The JMPCA transaction presented the opportunity to work with the “highly seasoned and experienced team” was timely and complimentary to Medalist’s portfolio, he said.

“In addition to offering our clients high-quality access to the CLO market, we expect the CLO business to further complement our existing platform with increased market access, investment sourcing capabilities, and diversity of our AUM and client base,” Ardisson said.

Medalist currently runs a structured credit strategy that includes investing in securities backed by loans and leases involving both residential and commercial real estate as well as aircraft. The firm also originates, purchases and funds asset-based loans alongside specialty finance companies.

As part of the transaction, Medalist will also contribute capital to a warehouse credit facility it began with BNP Paribas, on 12 October, that is worth $100 million.

JMP Group declined to comment.

The CLO market has seen a lot of activity in the first quarter of 2019.

In January, CIFC launched a CLO fund to complement its transition into the European credit market. In February, Nassau Re announced its strategy shift which included expanding into the CLO market. Earlier this month, Tetragon Credit Income Partners closed on more than $430 million for taking control positions in CLO equity tranches.

Medalist started as a spin-out from Candlewood Investment Partners in 2018 and has more than $2.25 billion in assets under management. JMP Group is a San Francisco-based financial services firm that operates multiple equity and credit strategies.