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Alternative investments

Madison Capital Funding raises $460 mn from Korea

Debt fund targets 7% IRR with 4-year investment period

By Jun 03, 2021 (Gmt+09:00)

(Source: Getty Images Bank)
(Source: Getty Images Bank)
A private debt fund managed by Madison Capital Funding, a US middle-market lender, has received a combined $460 million in commitments from seven South Korean institutional investors. 

The fund will provide senior credit facilities to middle-market US companies, with $10 million-$50 million in earnings before interest, tax, depreciation and amortization, according to banking sources on June 2.

It targets an internal rate of return of over 7% with an investment period of four years. The unidentified Korean institutions participated in the fund via KB Asset Management Co. in late May.

No further details such as its fundraising target were immediately available.

Chicago-based Madison Capital Funding, founded in 2001, focuses on senior secured loans to US middle-market companies. As a wholly owned unit of New York Life Insurance Co, it manages $12 billion in assets.
Since 2017, Madison Capital Funding has been attracting capital commitments from Korean institutions. Last year, it joined the pool of the National Pension Service's (NPS) external managers for the first time in its history as the world's No. 3 pension scheme diversified into medium-risk, medium-return assets such as private debt.

Write to Chang Jae Yoo at

Yeonhee Kim edited this article.

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