Key Takeaways
- • Secondaries firm Coller Capital closed a continuation-vehicle deal with Ares Management Corp. that amassed more than $1.3 billion in total commitments, according to a statement released Tuesday.
- • The transaction transfers a 2018-vintage portfolio of first-lien, floating-rate loans to sponsor-backed middle-market companies into a new continuation vehicle.
- • Ares will continue to manage the portfolio within the new vehicle, extending the life of the assets rather than selling them outright.
- • The deal reflects growing use of credit secondaries and continuation vehicles to provide liquidity and extend hold periods for private credit assets.
Summary
Coller Capital, a secondaries investment firm, has closed a transaction that extends the life of a private credit portfolio managed by Ares Management Corp., with total commitments exceeding $1.3 billion, according to a statement issued Tuesday and reported by Bloomberg.
The portfolio consists of first-lien, floating-rate loans originated in 2018 to sponsor-backed middle-market companies. Under the structure, the assets will be transferred into a new continuation vehicle. Ares will remain the manager of the portfolio, maintaining continuity in the underlying credit exposures while giving investors in the original fund the option to take liquidity or roll into the new vehicle.
Continuation vehicles have become an increasingly common tool in the secondaries market, allowing general partners to extend ownership of mature assets and providing secondary buyers access to established portfolios. The Coller-Ares transaction is a notable example of this approach applied to a credit portfolio, as opposed to private equity assets, where such structures have been more widely used.
The portfolio consists of first-lien, floating-rate loans originated in 2018 to sponsor-backed middle-market companies. Under the structure, the assets will be transferred into a new continuation vehicle. Ares will remain the manager of the portfolio, maintaining continuity in the underlying credit exposures while giving investors in the original fund the option to take liquidity or roll into the new vehicle.
Continuation vehicles have become an increasingly common tool in the secondaries market, allowing general partners to extend ownership of mature assets and providing secondary buyers access to established portfolios. The Coller-Ares transaction is a notable example of this approach applied to a credit portfolio, as opposed to private equity assets, where such structures have been more widely used.
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