Monroe invests 60% of PCF II

The Chicago-based firm has executed 49 deals since its 2015 launch.

Monroe Capital has invested $903 million of the $1.5 billion of deployable capital from its latest private credit fund, constituting 60.2 percent of the vehicle, according to an investor presentation.

The Monroe Capital Private Credit Fund II closed in October and collected $800 million in equity commitments, beating its $600 million fundraising target. The $1.5 billion figure includes leverage.

Monroe declined to comment.

The Private Credit Fund II’s portfolio consists of 49 companies, including four without private equity sponsors, documents from the Alaska Permanent Fund Corporation showed. Monroe’s portfolio companies have an average of 3.8x  leverage as of 31 March, with an effective borrower coupon rate of 9.5 percent and average EBITDA of $18.5 million.

The fund directly originates senior secured loans, unitrache and opportunistic investments. The fund made its first sale in May 2015, a filing with the US Securities and Exchange Commission shows.

By 31 December, the levered and unlevered sleeves of Fund II showed a net cumulative internal rates of return of 26.7 percent and 12 percent, respectively. The average loan-to-value ratio of deals from the fund was 45.7 percent with a closing fee of 1.7 percent.

As of 31 March, 43 percent of the Fund II holdings were refinancings, 36.5 percent acquisitions, 6.4 percent dividend recaps, 5.8 percent collateralised loan obligation deals, and 8.2 percent other types of deals.

The top three industries represented in the deals were healthcare and pharmaceuticals along with retail and specialty finance. First lien deals accounted for 91.1 percent of the transactions, while opportunistic accounted for 8.8 percent and second lien 0.2 percent. Monroe was agent on 30 of the 49 deals.

The Alaska pension plan has committed to the fund, along with the Orange County Employees Retirement System ($120 million), New Hampshire Retirement System ($50 million), and Chicago Policemen's Annuity & Benefits Fund ($20 million), PDI data showed.