Description

Ares Capital Corporation operates as a business development company (BDC) with a dedicated focus on providing capital solutions to middle-market enterprises. The firm specializes in funding a diverse range of transactions, including corporate acquisitions, recapitalizations, management-led leveraged buyouts (LBOs), and offering rescue financing and mezzanine debt, in addition to broader restructuring support. Beyond these specific scenarios, it also provides capital for growth initiatives and general refinancing needs. Its investment strategy primarily targets companies within the basic and growth manufacturing, business services, consumer products, healthcare products and services, and information technology service sectors. However, Ares Capital also considers opportunities in industries such as hospitality (restaurants), retail, the energy sector (oil and gas), and other technology-driven businesses. Geographically, the fund operates across several regions: its New York office manages investments in the Northeast, Mid-Atlantic, Southeast, and Southwest, while the Chicago office oversees the Midwest, and the Western region is covered by its Los Angeles office. In terms of investment parameters, Ares Capital typically commits between $20 million and $200 million per transaction, with a potential maximum of $400 million, targeting companies that generate an EBITDA ranging from $10 million to $250 million. For debt-specific investments, the typical range is between $10 million and $100 million. The firm utilizes a comprehensive suite of financial instruments for its investments, which includes revolvers, first and second lien loans, unitranche facilities, mezzanine debt, private high-yield bonds, junior capital, subordinated debt, warrants, and non-controlling preferred and common equity stakes. Additionally, Ares Capital selectively participates in senior and subordinated debt financings spearheaded by third parties and opportunistically seeks to acquire distressed or discounted debt positions. The corporation prefers to take on a leadership or agent role in the transactions it finances and often seeks representation on the boards of its portfolio companies.