Business Development Corporation of America, a non-traded business development company affiliated with Benefit Street Partners, has formed a joint venture with an investment vehicle managed by Cliffwater LLC to create the BDCA Senior Loan Fund LLC, which invests primarily in senior secured loans of U.S. middle-market companies. In addition, BDCA amended its credit facility with JP Morgan to increase its borrowing capacity.
Cliffwater is an alternative investment advisory and management firm with approximately $77 billion in assets under advisement that primarily serves institutional investors.
BDCA Senior Loan Fund initially consists of a $684 million portfolio in investment principal, approximately 90 percent of which is comprised of senior secured loans contributed from BDCA. BDCA also made a cash contribution of $43.75 million to the joint venture.
The fund’s equity ownership is 87.5 percent for BDCA and 12.5 percent for Cliffwater. BDCA and Cliffwater have equal voting rights on the board of managers. Benefit Street Partners will provide the day-to-day administrative oversight of the fund.
In addition to the joint venture, BDCA amended its credit facility with JP Morgan to increase its borrowing capacity from $300 million to $400 million.
BDCA is a non-traded business development company with a $2.2 billion investment portfolio, which primarily consists of senior loans to middle market companies, as of September 30, 2020. The company commenced its initial public offering in January 2011 and raised $1.9 billion before closing the offering in April 2015. Combined with distribution reinvestment plan proceeds, the company has raised $2.3 billion as of the third quarter of 2020.