First Eagle Investment Management, which has approximately $ 99 billion in assets, buys THL Credit Advisors, which includes publicly traded fixed income securities and direct lending business in the middle market.
THL Credit was founded in 2007 as a credit subsidiary of private equity firm Thomas H. Lee Partners.
“We believe the combined platform represents a compelling value proposition for a wide range of investors and other players in the credit market,” said First Eagle President and CEO Mehdi Mahmud in a statement.
Mergers and acquisitions abound in alternative credit, one of the most popular investment categories in recent years. Among other transactions, BlackRock acquired a private credit manager Tennenbaum Capital Partners earlier this year.
Once the $ 17 billion THL deal is finalized, First Eagle will have approximately $ 23 billion in total credit assets. THL CEO Chris Flynn will oversee the Combined Credit Group and report to Mahmud. Blackstone and Corsair Capital acquired a majority stake in First Eagle under an agreement reached in 2016.
First Eagle made its first foray into credit when it acquired NewStar Financial, a heavily syndicated direct lender and loan provider. The 2017 agreement enabled First Eagle to offer credit strategies to institutional and retail investors. The deal was part of a larger deal that Blackstone was able to help craft with its GSO credit arm. While First Eagle secured the direct lending business from NewStar, GSO purchased the portfolio, which included approximately $ 2.4 billion in middle market loans and other credit investments, for a new fund it took. offered to institutional investors.