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GSO acquires USD2.4bn NewStar Financial credit investment portfolio

GSO Diamond Portfolio Fund, a newly formed USD950 million investment fund sponsored by GSO Capital Partners (GSO), has closed on the previously announced acquisition of approximately USD2.4 billion in corporate loans and other credit investments from NewStar Financial (NewStar).

Immediately following the sale of these assets to the fund, NewStar was acquired by First Eagle Investment Management (First Eagle), a privately owned investment firm with USD116 billion in assets under management.

GSO believes this investment represents an attractive and unique opportunity for the Fund’s investors to gain access to GSO’s large and growing loan platform via a diversified and funded portfolio of primarily high-quality, first-lien loans to private equity sponsor backed companies. GSO has engaged First Eagle and the former NewStar team to assist in servicing the assets acquired by the Fund.

Bennett Goodman, Senior Managing Director and Co-Founder of GSO, says: “This transaction demonstrates GSO’s capabilities to develop creative solutions, in large scale, for complicated situations involving financings for mergers and acquisitions. This new Fund is an excellent complement to our direct lending strategy and we look forward to working with First Eagle and the former NewStar team going forward.”

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