MidCap FinCo. Ltd. and funds managed by Apollo Global Management (NYSE APO) affiliates have teamed up to buy Mubadala GE Capital's loan portfolio, as part of General Electric Corp.'s (NYSE: GE) planned divestiture of GE Capital.
The Abu Dhabi-based group is a commercial finance joint venture between Abu Dhabi government investment firm Mubadala Development Corp. and GE Capital. The portfolio contains about $3.6 billion in corporate and real estate loans in the U.S. and Europe.
The deal allows MidCap Financial (the parent of the acquirer) to grow in the middle market lending space. MidCap is managed by Apollo's credit business. The firm is a specialty finance group that provides senior debt to middle-market companies.
Perella Weinberg Partners and Paul Weiss Rifkind Wharton & Garrison advised MidCap, and Citi and Allen & Overy advised the Mubadala-GE joint venture.
In April, GE CEO Jeffrey Immelt announced the business' plan to shed GE Capital to refocus on GE's core industrial operations. In the divestiture most significant to middle-market dealmakers, the company sold Antares Capital (formerly GE Capital Sponsor Finance) to Canada Pension Plan Investment Board in a deal that closed in August. Antares, acquired by GE Capital in 2005, lends primarily to private equity-backed middle-market companies. Now flying solo, Antares plans to expand the types of loans it makes. For more, see For GE Capital's Coveted Antares Unit, New Owner Means Expansion Beyond Senior Debt.
GE Capital is also reportedly selling private equity investment group to Paris-based asset manager Ardian for about $500 million. Other sales include: Capital One Financial Corp.'s $9 billion deal for the company's health-care finance unit; and Sumitomo Mitsui Financial Group Inc.'s planned purchase of GE's European buyout-lending unit for $2.2 billion.