Man Group has entered into an agreement to acquire the US credit manager Varagon Capital Partners, which will become known as Man Varagon.
Under the terms of the agreement, the alternatives asset manager will pay $183m in cash to selling interest holders Aflac, Corebridge Financial, American International Group, and former members of Varagon's management team.
The transaction, subject to regulatory approval, is expected to close on Q3 2023 and once completed, Varagon CEO Walter Owens will continue to manage the business, supported by its existing staff across offices in New York, Fort Worth and Chicago.
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Varagon's investment committee, investment team and investment processes will remain unchanged, with the firm's access to new investors "bolstered" by Man Group's global distribution.
With $11.8bn of assets under management and $15.4bn of total client commitments, the firm operates in the core US middle market, having completed $24.5bn of financings to over 300 companies and 138 sponsors.
Man Group said Varagon's experienced management team and sophisticated client base, with a particular focus on the insurance channel, bring "significant institutional credibility" to support its growth in US private credit.
According to the firm, a complementary US-focused direct lending strategy will enhance its investment capabilities, with Varagon bringing the ability to deploy these in a "customisable" format for the world's largest institutional investors.
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Robyn Grew, incoming CEO at Man Group, said: "We are thrilled to have Varagon join Man Group as an additional investment engine. This acquisition is indicative of our commitment to diversifying our client offering and our strategic expansion ambitions in the U.S.
"Varagon has built a high-quality investment platform and shares our vision to deliver outperformance for clients. Our extensive distribution network and operational expertise will support Varagon with its continued growth and delivery for clients, and we very much look forward to working with such a strong team."
Varagon CEO Owens added: "We are excited to be joining Man Group, a world-class investment firm with global distribution capabilities, a strong brand and infrastructure, and a like-minded, collaborative culture.
"We believe a combination of Man Group and Varagon will enable us to preserve our proven investment process while helping us scale our suite of products and continue to deliver compelling results to our clients and sponsor partners."
