Angelo Gordon launches new $800m unit to target growing private debt demand

Angelo, Gordon & Co., a $52bn alternative investment firm focused on credit and real estate investing, announced that AG Twin Brook Capital Income Fund has launched with more than $800m in total assets.

TCAP is a non-traded business development company that has approximately $530 million in equity and over $1 billion in total investment commitments at launch.

Effective January 1, TCAP completed its merger with AGTB Private BDC, with TCAP as the surviving company; AGTB Private BDC, TCAP’s predecessor vehicle, was an affiliated, privately offered BDC with the same investment manager and investment objective as TCAP.

TCAP seeks to generate attractive, consistent total returns – predominantly in the form of current income and, to a lesser extent, capital appreciation – by targeting investment opportunities with favorable risk-adjusted returns. The Fund targets a portfolio principally comprised of floating rate, senior secured loans to borrowers in a wide variety of geographies and industries.

TCAP invests predominantly in loans that are at the top of the capital structure, backed by collateral, and have strong lender protections in place, which we believe reduces risk of principal loss and delivers more stable returns over time. In line with Angelo Gordon’s differentiated middle market direct lending strategy and informed by our team’s wealth of experience in the space, TCAP focuses on investing in loans to U.S. private equity-backed companies in the middle market, with an emphasis on lower middle market businesses – which we define as those with less than $25 million of EBITDA.

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“We’ve observed growing interest in private credit as an attractive alternative to traditional fixed income in recent years. However, as the private debt space has evolved and attracted more capital, we’ve seen investors become increasingly discerning and more selective when it comes to the types of strategies they are looking at,” said Trevor Clark, Chief Executive Officer of TCAP and head of Angelo Gordon’s middle market direct lending business, Twin Brook Capital Partners. “Members of the senior team at Twin Brook have spent over 20 years focused on the lower middle market, so it is not only a space that our investment professionals know well, but a substantial addressable market that we believe offers a robust opportunity set. In our view, our lower middle market-focused strategy represents a meaningful differentiation opportunity in the private credit space.”

Josh Baumgarten, Co-CEO, Co-CIO, and Head of Credit at Angelo Gordon, added, “Middle market direct lending is a core component of Angelo Gordon’s established credit platform, and we’re thrilled to continue the growth of the business with the launch of TCAP. As the industry has continued to evolve, demand for private credit products has remained robust, and we are pleased to be able to provide a broader range of investors and advisors with access to our differentiated direct lending strategy and deeply experienced team.”

In connection with the Merger, TCAP issued 20,943,030 Class I common shares to the Predecessor BDC’s investors, and going forward, TCAP intends to sell shares in its continuous offering on a monthly basis.

Source: Press Release

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