Sells financing unit: GE Private Equity
Published: June 9, 2015
Sells financing unit: GE Private Equity, Canada Pension Plan Investment Board (CPPIB) said on Tuesday it has agreed to buy GE Capital’s private equity lending portfolio for $12 billion, in a deal that will greatly expand the largest Canadian pension fund’s lending business.
GE’s Chicago-based Antares unit is the leading lender to middle market private equity-backed transactions in the United States. Over the past five years, Antares has provided more than $120 billion in financing.
“This acquisition exemplifies our strategy to achieve scale in key sectors through platform investments,” said CPPIB’s Chief Executive Officer Mark Wiseman in a statement. “It secures a market-leading business that is exceptionally well positioned.”
The previously reported deal had been widely expected to be finalized this week.
GE’s retreat from lending and a broader move to reduce its exposure to its finance arm comes as U.S. regulators move to curb aggressive lending by financial institutions. GE announced plans in April to sell $200 billion worth of finance assets as it focuses on its industrial products business.
In a separate statement, GE said it plans to continue to run the Senior Secured Loan Program (SSLP) – a joint venture between affiliates of GE Capital and affiliates of Ares Capital; and its Middle Market Growth Program (MMGP), a joint venture between affiliates of GE Capital and affiliates of Lone Star Funds; for a period of time to provide CPPIB the opportunity to work with both parties.
If CPPIB is unable to reach deals with both parties GE said it plans to wind down its investments in those two programs.
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