Deerpath Capital Management reported investment activity of $3 billion into US-headquartered companies backed by private equity sponsors over a 12-month period ending June 30, 2022.
Deerpath invested in more than 100 businesses across a diverse set of service industries including, but not limited to, healthcare, home services, information technology services and facility services. Companies in Deerpath's loan portfolio during this period had a median enterprise value of $121 million, an operating history of 24 years, and a net senior debt/EBITDA of 3.7x. The capital, issued via more than 300 transactions, supported a mix of leveraged buyouts, add-on acquisitions, growth financings, and recapitalizations for both existing portfolio and new platform companies, averaging three transactions per week.
"We continue to see strong origination and deal activity across sectors that meet our threshold for investments between $25 million and $75 million,'' said Reed Van Gorden, Head of Originations and Managing Director. "In the last year alone, Deerpath has reviewed more than 1,100 opportunities, which is a testament to our 15-year presence in the lower middle market and deep-rooted relationships with a large network of sponsors. Despite current market turmoil, the firm is on-track to have another record year of deal origination."
As the largest non-bank lender in the U.S lower middle market, defined as companies with $50 million to $150 million of Enterprise Value, Deerpath differentiates itself as a safety-first investor in the massive direct lending market. The firm focuses on capital preservation, ample downside protections, income generation, and conservative structures across full credit cycles, rather than adding risk in pursuit of higher yields.
Deerpath Capital Management, LP is one of the largest providers of customized, cash-flow based senior debt financing to lower-middle market companies, backed by a private equity sponsor across a diverse set of service-based industries. Since being founded in 2007, the firm has deployed more than $7 billion across 750-plus investments. As of September 1, 2022, the firm's AUM is approximately $5 billion.