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The direct-lending market is dominated by private equity firms, which in recent months have been looking to expand their footprints in the sector as mid-sized banks tighten loan standards.
The fund named Overland Advisors will target at least $5 billion in investible capital with a focus on meeting credit requirements of North American mid-sized companies, the San Francisco-based bank and Centerbridge said.
The companies added that the lending would primarily be in the form of senior secured loans to non-sponsored clients.
Abu Dhabi Investment Authority and British Columbia Investment Management Corporation have agreed to provide nearly $2 billion in initial equity commitments.
Bigger banks have also started dipping their toes in the sector to grab a slice of the lucrative market. Earlier this year, JPMorgan Chase (NYSE:JPM) forayed into the direct lending business by setting aside at least $10 billion, Reuters reported, citing a person with knowledge of the matter.
