Kayne Anderson BDC Inc., a business development company externally managed by its investment adviser, KA Credit Advisors LLC, which is an affiliate of Kayne Anderson Capital Advisors LP, announced an investment in SG Credit Partners Inc., a Southern California-based national credit platform focused on the lower middle market.
SG Credit was formed in 2013 and has offices in Newport Beach and Santa Monica, along with regional offices in Atlanta, Boston and Chicago. It has invested in more than 200 companies, originating over $1 billion in commitments across its three lending verticals (commercial finance, consumer products and software & technology). It plans to use its expanded capital base to grow existing verticals and develop adjacent businesses.
“This is a key strategic opportunity for KBDC and highlights our commitment to growing our portfolio with value-enhancing investments,” said Doug Goodwillie, co-chief executive of KBDC, in a statement. “SG Credit’s unique lower middle market lending platform is highly complementary to our business and will further enhance the returns of KBDC’s diversified portfolio.”
The investment complements KBDC’s private credit investment capabilities by further diversifying proprietary investment channels and will be structured as an $80-million term loan facility, $34-million delayed draw term loan facility and $12-million common equity investment. KBDC anticipates that its debt investment in SG Credit will be immediately accretive to earnings in 2025, and it will be a significant minority shareholder in SG Credit following the closing of the transaction.
“We are proud and excited to partner with a firm of the caliber and history of Kayne Anderson. This collaboration will not only support our growth with additional capital but also enable us to offer innovative, value-added financing solutions to a wider range of companies,” said Marc Cole, co-founder and chief executive of SG Credit, in a statement.
Fenchurch Advisory Partners US LP served as financial advisor and Mayer Brown LLP as legal advisor to KBDC. Solomon Partners served as financial advisor and Greenberg Traurig LLP and Brenner, Saltzman & Wallman LLP as legal advisors to SG Credit.
Information for this article was sourced from Kayne Anderson BDC.