Mount Logan Capital's Strategic Investment in Runway Growth
Mount Logan Capital Makes Strategic Investment in Runway Growth Capital
Mount Logan Capital Inc. has recently completed an important strategic investment in Runway Growth Capital LLC, positioning itself favorably within the North American credit markets. This investment, conducted alongside BC Partners and its affiliates, reinforces Mount Logan's commitment to expanding its capabilities in alternative asset management.
Details of the Investment
As part of the investment, Mount Logan issued approximately 2,693,071 common shares at a deemed price of C$2.67. This pricing reflects the 20-day volume-weighted average leading up to the completion of the transaction, highlighting the thoughtful approach taken in valuing the shares. The transaction underscores Mount Logan’s proactive strategy to enhance its investment portfolio while aligning itself with dynamic companies that offer growth potential.
Role of Runway Growth Capital
Runway Growth Capital LLC acts as an investment adviser to various funds, including Runway Growth Finance Corp. This association will allow Runway to broaden its influence in the business development sector, particularly by providing essential financing solutions to fast-growing companies seeking alternatives to equity financing. The partnership aims to leverage synergies and strengthen both firms’ positions in the market.
COMMENTARY FROM MANAGEMENT
Ted Goldthorpe, the Chief Executive Officer and Chairman of Mount Logan, shared his excitement regarding the new partnership. He mentioned, "We are thrilled to officially welcome David and the talented team at Runway to the Mount Logan family. Our collaboration with Runway will enhance our efforts in providing financing solutions to late-stage growth platforms.” This spirit of collaboration indicates a promising trajectory for both firms as they integrate their strengths.
Trends in North American Credit Markets
The strategic investment comes at a time when the North American credit markets are evolving, with firms seeking innovative ways to support growth. Mount Logan's investment strategy is particularly focused on identifying opportunities that present attractive risk-adjusted returns and minimal risk of principal impairment. This commitment is likely to yield benefits as they endeavor to expand their product offerings in private credit.
Advisory Support and Legal Framework
The transaction was supported by multiple legal advisors to ensure a seamless process. Wildeboer Dellelce LLP provided Canadian legal counsel to Mount Logan, while Simpson Thacher & Bartlett LLP served BC Partners. This multimodal advisory framework reflects the complexity and strategic nature of the investment.
The Future Landscape for Mount Logan and Runway
Moving forward, both companies aim to capitalize on the opportunities presented by the investment and the changing landscape of credit markets. The collective expertise of Mount Logan and Runway will empower them to deliver innovative financial solutions tailored to the needs of their clients. As Runway continues to expand its portfolio of private funds, the alliance is expected to facilitate avenues for collaborative growth.
About Mount Logan Capital Inc.
Mount Logan Capital Inc. provides alternative asset management and insurance solutions, operating primarily in the North American public and private debt securities markets. It also focuses on reinsurance of annuity products through its subsidiaries, including Mount Logan Management LLC.
About Runway Growth Capital LLC
Runway Growth Capital LLC is dedicated to advising investment funds that offer growth capital alternatives to companies needing financing. Its leadership under David Spreng ensures a robust platform for lending, focused on senior term loans ranging from $30 million to $150 million, targeted at rapidly growing companies.
Frequently Asked Questions
What is the significance of Mount Logan Capital's investment?
The investment enhances Mount Logan's position in the North American credit markets and supports the growth initiatives of Runway Growth Capital.
How will this partnership affect Runway Growth Capital's operations?
This partnership allows Runway to leverage Mount Logan's resources and expertise for scaling operations and increasing capital solutions for clients.
Who were the legal advisors for this investment deal?
Wildeboer Dellelce LLP and Simpson Thacher & Bartlett LLP provided legal support, ensuring the transaction's success.
What opportunities does this investment create in credit markets?
The investment opens up new avenues for providing flexible financing solutions to mid-market companies seeking growth capital.
How does Mount Logan Capital plan to leverage this investment?
Mount Logan aims to expand its private credit fund offerings and enhance its investment strategies through this strategic partnership.
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