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Babson Capital Management Launches Babson Capital Finance

May 15, 2013, 08:03 AM
Filed Under: New Venture

Babson Capital Management, a global investment management firm with over $180 billion in assets under management, announced the formation of Babson Capital Finance (BCF) as an operating subsidiary that will provide financing to middle-market companies and specialized industries globally. Mike Hermsen, Managing Director of Babson Capital Management, has been named as CEO of BCF, and will report to Tom Finke, CEO and Chairman of Babson Capital Management. Mr. Finke will also serve as chairman of BCF’s Board of Directors.

Babson Capital Management has a proven 25-year history of providing capital solutions to middle-market companies, and the formation of BCF consolidates the firm’s existing global middle-market leveraged finance and energy finance investment teams into one unified platform. This strategic realignment, combined with a balance sheet backed by its parent corporation, Massachusetts Mutual Life Insurance Company (MassMutual), enables the firm to expand its origination and investments in a broad range of products, including middle-market senior and second-lien loans, unitranche, subordinated debt and private equity co-investments. In addition, BCF will manage funds and customized separate accounts for clients seeking private finance solutions for their investment portfolios.

“We plan on establishing Babson Capital Finance as a leading global finance company serving middle market companies, especially those backed by financial sponsors and in certain specialized industries,” said Finke, who notes that many regional banks and other traditional financiers have either reduced their activity levels or withdrawn completely from the leveraged finance market in recent years due to increasing financial regulations and changing economic conditions. According to Hermsen, “As these traditional providers reduce their footprint in the leveraged finance market it presents a unique opportunity for Babson Capital Finance. As a global business with teams located in the U.S., Europe, Asia and Australia, we are well positioned to fill that void.”

Babson Capital Management LLC and its subsidiaries serve institutional investors around the globe and have $181 billion in assets under management as of March 31, 2013.

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