Bahrain’s Investcorp has announced an agreement to acquire the debt management business of UK-based 3i Group.
The GBP222m ($271m) deal will give the firm an additional $12bn of assets under management, bringing its total to $23bn.
Investcorp announced last year it planned to grow its assets under management to $25bn in the medium term.
The transaction is expected to close in the first half of 2017, subject to regulatory approval.
The unit, 3iDM, primarily invests in senior secured corporate debt issued by mid and large-cap corporates in Western Europe and the US.
It employs roughly 50 people in London, New York and Singapore.
Investcorp said it would maintain the existing management with Jeremy Ghose continuing as CEO and John Fraser as head of US operations.
“This is a milestone deal which will bring together two complementary businesses and broadens product diversity for existing clients of both Investcorp and 3iDM while deepening the geographical reach of the enlarged business,” said Investcorp executive chairman Mohammed Al Ardhi
“The combination brings with it some of the most talented credit investment professionals in the industry together with a large universe of private and institutional clients spanning Europe, Asia, the US and the Arabian Gulf.
Investcorp co-CEO Rishi Kapoor said the deal was a value-added transaction that would be “accretive” for Investcorp from day one.
“We see this business as one of the central pillars of Investcorp’s product platform going forward and are absolutely committed to continuing to grow the business on multiple fronts including fundraising, product development and capital support,” he said.
The deal is described as the largest ever strategic acquisition by Investcorp and will be funded through the company’s existing balance sheet.
Investcorp has been very active in recent months with a number of acquisitions and sales in Europe and the US.
Abu Dhabi-based Mubadala acquired a 20 per cent stake in the company in July.