Tree Line passes the $1bn AUM mark with latest fundraise

Tree Line Capital Partners has collected an additional $800 million in debt and equity commitments as it seeks to hire four additional staff this year, the lower mid-market lender said in a Thursday statement.

The San Francisco-based firm now oversees more than $1.2 billion in assets as it targets $300 million for its second fund. So far, Tree Line Direct Lending II has collected $139.8 million and has a target of up to $300 million, according to Securities and Exchange Commission regulatory filings. The Montana Board of Investments has allocated $50 million toward the vehicle.

Tree Line, which provides senior debt to lower mid-market companies, also plans to hire more personnel in both the investment and operations areas after adding three investment professionals in 2018, it said in the statement. The firm could not be reached for additional comment.

In November, Tree Line supported Soundcore Capital Partners’ Pumpman, a pump repair and maintenance company. The next month it backed Huron Capital’s acquisition of WD Lab Grown Diamonds, a business that uses materials science technology to lab-grow diamonds.

Last year, senior debt funds raised $47.28 million, a decrease from the $64.58 million raised in 2017 – the largest amount ever raised for a single year – according to PDI data. The outlook for senior debt managers this year has been bright though, at least according to the PDI Perspectives annual LP survey in which a plurality of investors said they were going to increase their target allocation to the strategy.

Tree Line is owned by Stone Point Capital, founders Thomas Quimby and Jonathon Schroeder and the University of Texas Management Company, which oversees investments for the University of Texas and Texas A&M college systems. Stone Point previously owned another direct lender, NXT Capital, until Orix Corporation purchased it in a deal that closed in August.