The family office of Dell Technologies Inc. billionaire Michael Dell is providing the first capital for a new private-credit firm called 5C Investment Partners, which was founded by two Goldman Sachs Group Inc. executives, the Financial Times reported on Tuesday.
Citing people familiar with the firm, the FT report said Dell plans to be a passive investor in the inaugural credit fund from 5C Investment Advisers through DFO Management, Dell’s family office.
The inclusion of a high profile investor such as Dell will often encourage other institutions to take part in the fund, at a time when private-credit continues to gain traction against competition from traditional banks.
Tom Connolly co-founded 5C Investment Partners in September as a credit investment firm, according to his LinkedIn profile.
He previously worked for 26 years as managing director at Goldman Sachs Group Inc.
GS,
as head of credit investing in the merchant banking unit of the firm.
Mike Koester co-founded 5C Investment Partners after working for 25 years at Goldman Sachs, where he was co-president of its alternative investments unit. He retired from Goldman Sachs last year.
“We believe that the long-term outlook for credit-oriented investments is attractive and that now is an ideal entry point for our team to leverage its experience and capabilities to serve our clients,” Connolly said in a statement to the Financial Times.
New York-based 5C Lending Partners plans to “generate current income and long-term capital appreciation” by investing in U.S. middle-market and upper middle-market companies through direct originations of first lien senior secured loans, according to a filing.
5C Lending Partners defines middle-market companies as $50 million or more of annual earnings before interest, income tax, depreciation and amortization, the filing said. The firm may from time to time invest in smaller companies.
For his part, Michael Dell is chairman and chief executive of Dell Technologies
DELL,
He founded Dell in 1984.
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