Markets

Ares Capital Completes Acquisition of American Capital to Bolster Position in Middle-Market Direct Lending

Ares Capital ( ARCC ) said Tuesday that it completed the acquisition of American Capital ( ACAS ), enhancing its position in middle-market direct lending in the U.S. Shares declined 0.7% in post-market.

The company continues to be the largest business development company in the U.S. with total assets of $12.3 billion as of Sept. 30.

The acquisition is expected to be "accretive to core earnings and provide many financial and strategic benefits," said Kipp deVeer, the CEO of Ares. "We expect a continued repositioning of legacy investments to enhance earnings at the combined company and further improve our company's outlook."

In connection with the takeover, Ares Capital Management LLC has also agreed to waive up to $100 million in income-based fees from Ares Capital for 10 calendar quarters, beginning Q2.

As of Sept. 30, the transaction increased and further diversified Ares Capital's portfolio of investments from $8.8 billion across 215 portfolio companies to about $11.8 billion across 314 portfolio companies, according to a statement.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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