Barclays Inks Partnership with Ares, Sells £500M of U.K. Leveraged Loans

Dec 21 2015 | 5:43pm ET

Barclays has sold a £500 million portfolio of U.K. leveraged mid-market loans to alternative investment manager and direct lending specialist Ares Management, and formed a partnership with the firm for future financings in the segment. 

The move is the latest step by London-based Barclays designed to sell off risky assets and boost its bottom line under new CEO Jes Staley.

The two firms will also provide joint financing in the form of senior debt, unitrache term debt and revolving credit facilities to mid-sized firms in the U.K., according to a press release. The purchase of £500M worth of similar performing loans, which are PE-backed, underpins the partnership, the firms noted. 

Like many large banks, Barclays has shied away from leveraged loans, which have high capital requirements, since stricter balance-sheet rules have come into force since the global financial crisis. A similar deal was struck in early December between Royal Bank of Scotland, AIG Asset Management, Hermes and M&G Investments, according to Bloomberg. 

“For almost a decade, Ares has been providing one-stop financing solutions for UK mid-market companies and their sponsors,” commented Michael Dennis, partner in Ares’ Direct Lending Group. “This partnership enhances our ability to meet the credit needs of our clients, which continue to expand in a changing market and regulatory environment."

Founded in 1997 and publicly traded, Ares was the first to bring unitranche financing solutions to the UK mid-market in 2007. The firm is now a leading European alternative lender, managing more than $92 billion of assets across tradable credit, direct lending, private equity and real estate.


In Depth

Q&A: Decathlon Capital On Revenue-Based Alternative Lending

Oct 30 2017 | 3:49pm ET

The explosion in private credit activity since the end of the financial crisis is...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Saxby: Not All EBITDA Is Created Equal

Nov 30 2017 | 8:02pm ET

Record levels of dry powder are driving competition among private equity firms to...