Audax Capital Raises $500M For Oversubscribed Private Debt Fund

Oct 17 2016 | 7:00pm ET

Audax Group has raised $500 million in committed equity capital for its third senior loan fund, the latest alternative investment company to increase its private debt footprint this year.

The new vehicle, named Audax Senior Loan Fund III, was oversubscribed and closed at its hard cap, the company said in a statement. The original target was $400 million in equity. 

The fund will employ modest leverage, Audax said, utilizing a credit facility of more than $1.1 billion in commitments to bring Fund III’s total investable capital up to $1.6 billion.

Investments made by the new fund will remain consistent with that of the Audax senior debt business, which invests primarily in first lien senior secured loans to U.S. middle market companies as part of private equity-sponsored buyouts. The last vehicle to raise money within Audax’s private debt operation was the firm’s fourth mezzanine fund, which raised $1.2 billion in mid-July.

"We appreciate the support from our existing and new investors and thank them for their commitment to Audax," said co-CEOs Geoffrey S. Rehnert and Marc B. Wolpow in a joint statement. “The continued demand for our senior debt products underscores the capability of our team, our differentiated approach, and our investors’ confidence in our consistent track record of delivering attractive risk-adjusted returns.”

Audax’s Senior Loan III is latest fund to tap into the seemingly insatiable institutional demand for private debt solutions. In recent months, NXT Capital raised more than $300 million in equity capital for its fourth debt fund, Monroe Capital raised $800 million for its second private debt fund, and over half of the private debt investors surveyed by Preqin in September plan to increase allocations to the investment class in the next twelve months. 

Based in New York, Audax has raised more than $15 billion of capital since inception in 1999 and currently manages over $11 billion through its Private Debt and Private Equity units. The firm raises capital from a broad mix of U.S. and international institutional investors, including public and corporate pension funds, insurance companies, endowments and foundations, and high net worth families, in addition to a significant commitment from the firm’s senior professionals.

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