Twin Brook back on the fundraising trail – exclusive

The Angelo, Gordon-owned mid-market lender is raising $1bn for its second fund, two months after closing the first.

Twin Brook Capital Partners, the mid-market lending subsidiary of Angelo, Gordon & Co. (AG), is marketing its second fund soon after closing its first. The firm is targeting $1 billion for its second direct lending fund, which, unlike the first, will offer levered and unlevered versions to investors, according to sources familiar with the firm.

AG declined to comment on fundraising.

The Chicago-based firm closed its first fund on about $600 million in May, beating its $500 million target. That fund has been investing its capital quickly. The vehicle has a total of $1.6 billion in committed capital, including LP fund investments, separate accounts and leverage, PDI understands.

A sizeable number of clients that looked at the first fund wanted an option without leverage, so AG launched the second vehicle with levered and unlevered sleeves to accommodate those investors, according to sources. The amount of money that will go into the levered option versus the unlevered one will depend on demand, though Twin Brook expects the total capital on the second fundraise to get up to $2 billion.

Leverage on the first fund was at 1.25:1 and the debt-to-equity ratio on the levered version of the second fund will be the same.

The firm targets senior financing of up to $200 million, with hold sizes from $15 million to $50 million. The average EBITDA of Twin Brook’s portfolio companies is at about $3 million to $50 million, according to the firm’s website.

Twin Brook was started in 2014 when AG hired Trevor Clark and Chris Williams, two former senior Madison Capital Funding executives, to lead the business.

New York-headquartered AG has about $26 billion in assets under management across its distressed debt, real estate, private equity and hedge fund businesses.