NEW YORK & SAN FRANCISCO--(BUSINESS WIRE)--Centerbridge Partners (Centerbridge) and Wells Fargo & Company (NYSE: WFC) announced they are entering into a strategic relationship focused on direct lending to non-sponsor North American middle market companies. To meet the alternative credit needs of this segment, Centerbridge intends to launch Overland Advisors to manage a newly formed business development company that will be primarily focused on making senior secured loans. Overland represents a transformative new business model for direct lending to middle-market companies, diversifying the market of clients served by private credit and direct lending.
The Centerbridge and Wells Fargo strategic relationship includes differentiated origination sourcing from Wells Fargo’s extensive middle market customer base, and an equity investment from Wells Fargo. In addition to expanding financing access to the non-sponsor segment, Overland will pursue other transactions, including traditional sponsor-backed direct lending opportunities.
Overland Advisors is targeting a minimum of $5 billion in investible capital, including $2.5 billion in equity commitments for this strategy. Anchor investors, including wholly owned subsidiaries of the Abu Dhabi Investment Authority (ADIA) and British Columbia Investment Management Corporation (BCI), have committed to provide nearly $2 billion in initial equity commitments.
“Overland represents a new paradigm in direct lending, bringing a relationship approach to direct lending and offering a much-needed capital solution in the large but underpenetrated non-sponsor U.S. middle market,” said Jeff Aronson, Co-Founder and Managing Principal of Centerbridge Partners. “We believe Overland draws on the unique and complementary capabilities of both Centerbridge’s leading private credit underwriting capabilities and Wells Fargo’s nationwide sourcing and origination network to offer an attractive new proposition for borrowers in the private lending and direct credit space at a particularly compelling time.”
“As a leader in U.S. middle market and asset-based lending, we are continually focused on finding ways to best serve our clients, and Overland can offer them options for alternative capital structures that can be used to pursue a broader set of growth and value creation initiatives across a variety of market conditions,” said Charlie Scharf, CEO of Wells Fargo. “Working with Centerbridge under our sourcing relationship will help us elevate our support of middle market clients.”
Hamad Shahwan AlDhaheri, Executive Director of the Private Equities Department at ADIA, commented, “Overland represents a highly differentiated and scalable approach to direct lending in the U.S. middle market. We are excited about our anchor investment in this unique platform.”
Daniel Garant, Executive Vice President & Global Head, Public Markets, BCI, said, “Direct Lending provides an important alternative financing source for middle market businesses. We believe Overland takes that to the next level by broadening and diversifying the types of businesses served, and we are pleased to be making this meaningful long-term investment.”
The sourcing relationship between Overland Advisors and Wells Fargo will provide an innovative, relationship-driven approach to direct lending that meets the capital needs of Wells Fargo clients and other non-sponsor owned middle-market businesses by providing important financing capacity and access to capital for family-owned and other privately owned businesses in North America that have limited connectivity to private credit. Harnessing Centerbridge and Wells Fargo’s strengths and scale and building on their respective track records and deep relationships, Overland will be well-positioned to offer a differentiated client experience for borrowers.
Overland expects to leverage Centerbridge’s recognized leadership as a private and alternative credit investor, with a seasoned investment team that has decades of experience creating innovative solutions and underwriting credit investments. It also expects to benefit from Wells Fargo’s long-term relationships, extensive client base and leading position in U.S. middle market and asset-based lending, supported by a nationwide network of relationship managers in 49 out of 50 of the largest markets across the country.
Overland Advisors will be controlled by Centerbridge Partners, and Wells Fargo will be a minority investor.
Centerbridge Partners, L.P. is a private investment management firm employing a flexible approach across investment disciplines — Private Equity, Private Credit and Real Estate — in an effort to develop the most attractive opportunities for its investors. The firm was founded in 2005 and as of June 30, 2023, has approximately $36 billion in capital under management with offices in New York and London. Centerbridge is dedicated to partnering with world-class management teams across targeted industry sectors and geographies.
About Wells Fargo
Wells Fargo & Company (NYSE: WFC) is a leading financial services company that has approximately $1.9 trillion in assets, proudly serves one in three U.S. households and more than 10% of small businesses in the U.S., and is a leading middle market banking provider in the U.S. We provide a diversified set of banking, investment and mortgage products and services, as well as consumer and commercial finance, through our four reportable operating segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. Wells Fargo ranked No. 47 on Fortune’s 2023 rankings of America’s largest corporations. In the communities we serve, the company focuses its social impact on building a sustainable, inclusive future for all by supporting housing affordability, small business growth, financial health, and a low‑carbon economy.
News, insights, and perspectives from Wells Fargo are also available at Wells Fargo Stories.
About Abu Dhabi Investment Authority (ADIA)
Established in 1976, ADIA is a globally-diversified investment institution that prudently invests funds on behalf of the Government of Abu Dhabi through a strategy focused on long-term value creation.
British Columbia Investment Management Corporation (BCI) is amongst the largest institutional investors in Canada with $233.0 billion in gross assets under management, as of March 31,2023. Based in Victoria, British Columbia, with offices in Vancouver, New York City, and London, U.K., BCI manages a portfolio of diversified public and private market investments on behalf of its 32 British Columbia public sector clients. With a global outlook, BCI integrates ESG factors in all investment decisions and activities that convert savings into productive capital to meet clients’ risk and return requirements over time. Founded in 1999, BCI is a statutory corporation created by the Public Sector Pension Plans Act.
This press release is not intended to, and does not, constitute an offer to purchase or sell securities of Overland Advisors or any entity advised by it. Any offer, solicitations to offer or sales of securities of Overland Advisors or any entity advised by it will only be made in accordance with the registration requirements of the Securities Act of 1933, as amended, or an exemption therefrom.
This press release contains forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “target,” “goals,” “plan,” “forecast,” “project,” other variations on these words or comparable terminology, or the negative of these words. These forward-looking statements are based on assumptions that may be incorrect, and neither Centerbridge nor Wells Fargo can assure you that the projections included in these forward-looking statements will come to pass. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Neither Centerbridge nor Wells Fargo undertakes an obligation to publicly update or revise any forward-looking statements made herein. There is no assurance that Overland Advisors will launch this strategy or any entity advised by it as described in this press release or at all.