Canada Pension Plan Investment Board (CPPIB) 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, Reuters reported Tuesday.
GE’s Antares unit is the leading lender to middle market private equity-backed transactions in the United States. In the past five years it has provided over $120 billion in financing, according to the report.
“This provides us with a very unique opportunity to access the U.S. middle market space via a very attractive platform,” said Mark Jenkins, CPPIB’s global head of private investments.
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 practices. 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 – a joint venture between affiliates of GE Capital and affiliates of Ares Capital; and its Middle Market Growth Program, 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.
