We focus on lending to middle-market and private companies. Our direct origination lending strategy incorporates a focus on leading the negotiation and structuring of the loans or securities in which we invest. We invest primarily in US middle-market companies, which generally have EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) of between $5 million and $75 million annually.
We partner closely with our middle market relationships to understand and tailor financing solutions to meet specific objectives including acquisitions, refinancing, capital for growth, leveraged buyouts, dividend recapitalization and restructuring.
Our dedicated sourcing team benefits from the breadth of Goldman Sachs’ network of relationships. This network and set of relationships provides us with direct access to the owners of US middle market companies and enables us to access proprietary investment opportunities.
We seek to structure loans with covenants and other structural safeguards. We target companies with strong cash flow, well-regarded management teams and strive for loan-to-value that leaves meaningful cushion.
Access to a leading platform
The team capitalizes on Goldman Sachs’ relationships, market insights, risk management expertise, technology and infrastructure through its investment approach.
Culture of risk management
We apply a strong focus on process to monitor and evaluate the performance of our investments. In addition, we benefit from Goldman Sachs’ extensive risk management capabilities, which have been developed and honed over many investment cycles.
Disciplined underwriting modelWe utilize investment practices and procedures developed over many decades. Further, Goldman Sachs houses a tremendous amount of industry knowledge and experience. We have the ability to draw upon these industry insights and expertise as we evaluate investment opportunities.
We seek to identify leading private credit managers with expertise in lending, underwriting, the bankruptcy process and managing operating companies, as well as the ability to quickly evaluate and execute transactions in an often-dynamic market. Our team operates around the world, leveraging access to the broader Goldman Sachs network to continually identify and evaluate new opportunities. We also have the ability to create customized private credit solutions tailored to our clients’ specific investment objectives.
A well-designed private credit program requires significant resources to identify potentially high value-add investment opportunities. Utilizing the scale and expertise of our geographic- and industry-focused strategy vertical teams, we seek to identify managers with expertise in origination, structuring, workout and reporting.
We take a differentiated approach to portfolio construction, engineering innovative solutions diversified across the capital structure, geographies, industries and strategies. Leveraging our extensive experience, we build portfolios across multiple credit opportunities.
We continuously evaluate credit markets for new opportunities, identifying managers well-positioned for the current environment. Supplemented by our dedicated legal, compliance and operational due diligence teams, we actively monitor our managers, maintaining close contact to understand and uncover potential risks.
Extensive experience in a complex market
Private middle-market lending is a highly-negotiated and often inefficient market where investors can benefit from our deep experience, with insights into both the private and public markets’ complexities. We leverage our structuring and valuation capabilities, developed across asset classes and industries, to evaluate potential credit opportunities.
Growth in a potentially imbalanced market
The supply of middle-market financing has declined; however, many believe demand may increase. Meanwhile, many other specialty lenders are no longer active in the space or have significantly reduced activity due to a greater focus on liquidity, creating an attractive supply-demand dynamic in the market.
Longstanding relationships and innovative opportunitiesOur extensive relationships enable us to employ a well-informed, highly selective process to evaluate high-quality managers and investment opportunities across various quantitative factors, whether accessing smaller niche funds or larger organizations.
For more information, please contact your GSAM relationship manager