Sagard closes debut credit fund above $500m target

The fund has made five investments so far, two of which are in Canada.

Sagard Holdings has deployed nearly one third of its $545 million first debt fund.

Sagard Credit Partners, launched in December 2017, exceeded its target size of $500 million and will continue to accept fundraising commitments until the end of the year.

The Toronto-based firm provides term loans, high-yield bonds and mezzanine financings, among others, to mid-market companies through the fund.

The fund will be focusing on North American companies with investments averaging around $30 million-$40 million, Private Debt Investor previously reported, and a source familiar with the situation said those figures had not changed after the latest fundraising round.

The source added that the firm anticipates a significant number of the investments being made in Canada, with two of the five investments completed so far in companies based in the country. Among those was a $250 million investment into Just Energy Group, a Toronto-based energy supplier, last month.

The fund had its initial close in January, raising $260 million.

“We believe there is an underserved market in the US and Canada in the private credit space, particularly as it relates to the non-sponsored market,” Adam Vigna, the firm’s managing partner and chief investment officer , told PDI in March about the decision to enter debt investing.

Healthcare of Ontario Pension Plan, BRK Capital and Walter Financial were among the investors in the initial closing.

The source added that Sagard Holdings hired an additional member of the investment team from CPIBB in September. The firm plans to makes several additional hires the investment team in the first quarter of 2019.

Sagard Credit Partners is the private credit investment vehicle for Sagard Holdings. The company was founded in 2005 as the investment branch of Power Corporations Canada. PCC is an international management and holding company with over $1.07 trillion in assets.