Sound Point Capital Acquires CVC Credit’s U.S. Direct Lending Unit
NEW YORK--(Business Wire / Korea Newswire) June 09, 2021 -- Sound Point Capital Management, LP, a credit-oriented investment management firm overseeing approximately $25 billion in total assets, is pleased to announce that it has acquired the U.S. direct lending platform of CVC Credit.
Terms of the transaction were not disclosed. As part of the agreement, Sound Point has hired a team of nine investment professionals from CVC Credit who together manage a portfolio of approximately $1 billion of assets. The team primarily provides first lien and unitranche debt facilities to U.S. middle-market companies. Borrowers have included companies in a wide variety of industry sectors, including consumer services, business services, health care, pharmaceuticals, hospitality, telecommunications, industrials and other sectors.
“We are thrilled to add this investment portfolio and talented team of individuals to our organization,” said Stephen Ketchum, founder and managing partner of Sound Point Capital. “This transaction brings another dimension to our already successful lending platform and positions us for further growth.”
The nine-person CVC team is led by Tom Newberry, Global Head of Private Debt at CVC Credit, and David DeSantis, Head of U.S. Private Debt at CVC Credit. Messrs Newberry and DeSantis have each been named Co-Head of Direct Lending at Sound Point.
“Sound Point’s credit platform is the ideal home for a group like ours,” commented Newberry. “We see this as a way to accelerate the growth of our business and widen our underwriting capabilities through future expansion.”
Added DeSantis, “Combining our team’s proven track record with Sound Point’s deep connectivity amongst institutional investors sets up a powerful alliance.”
New York-based Sound Point in May 2018 launched its “Strategic Capital Fund” with approximately $500 million in committed capital from investors. That fund has focused primarily on highly structured, bespoke financings for private and public companies undergoing periods of transition and turnaround. The U.S. direct lending platform of CVC Credit, with its focus on providing growth capital and acquisition financing to proven middle market companies, will complement these efforts.
“The prevalence of so-called ‘non-bank lending’ in recent years is widely known,” Ketchum continued. “As traditional banks have shied away from certain areas of the market, firms like Sound Point have been able to successfully deploy capital with strong principal protection, providing attractive floating-rate returns to investors. Adding Tom, David and their entire team to our 100-person firm will help supercharge our efforts in this line of business.”
Ken Young, Chair of CVC Credit, commented, “Following a strategic review in 2020, we decided to sell our US Direct Lending business. We are delighted to announce the sale to Sound Point and we wish Tom, David and all the team our best. Following this sale, we are highly focused on further accelerating the growth of CVC Credit across our three key areas: Performing Credit, European Direct Lending and Capital Solutions to ensure CVC Credit is ever more aligned with the CVC Network.”
In total, CVC Credit’s U.S. direct lending platform being absorbed by Sound Point has deployed more than $1.7 billion across 88 transactions. The senior team has approximately 70 years of collective experience, having completed more than $18 billion in loan commitments during that time. Core senior team members have worked together or known each other for over 20 years.
Berkshire Global Advisors served as financial advisor to CVC Credit on this transaction.
About Sound Point Capital Management, LP
Sound Point is an alternative asset management firm founded in 2008 with particular expertise in credit strategies. Based in New York, with offices in London, the firm manages money on behalf of institutional investors including top-tier pensions, foundations, insurance companies, wealth management firms and family offices. Sound Point‘s strategies span the spectrum of liquid and illiquid credit alternatives and include funds and managed accounts focused on leveraged loans, special situations, distressed debt, structured credit, direct lending and commercial real estate. Sound Point currently manages approximately $25 billion of assets. Five principals of Stone Point Capital LLC, as well as Dyal Capital Partners, a division of Blue Owl Capital Inc. [NYSE: OWL], are strategic investors in our business. For more information, please visit Sound Point’s website at www.soundpointcap.com.
About CVC Credit
CVC Credit is the credit management business of CVC. CVC Credit is a global credit asset manager with offices in the U.S. and Europe, over 60 investment professionals and US$28 billion assets under management. The platform seeks to generate for its investors positive absolute returns and attractive risk-adjusted returns on capital throughout the credit cycle. CVC Credit has built a diverse business which creates significant synergies across its investment strategies. For further information about CVC Credit please visit: www.cvc.com/credit.
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