Invesco - Wed, 05/31/2023 - 15:33

Why pursue direct lending in the core middle market?

The overall scale of the middle market and tailwind of private equity (PE) sponsor transaction activity has created an ever-present need for middle market debt financing. But the middle market is vast, comprising companies that range from as small as $100 million to as large as $1 billion in enterprise value. By pursuing direct lending opportunities in the core middle market, investors may benefit from a fragmented opportunity set, a more favorable competitive environment, and attractive yields, among other potential advantages.

Here, we define the core middle market, describe the development of the market landscape, and identify essential ingredients for success when pursuing a direct lending strategy in the core middle market.

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Invesco

Invesco is a leading independent global investment management firm, dedicated to helping insurance investors achieve their financial objectives. We understand insurers have unique investment needs, from optimizing capital efficiency and yield, to managing reserves and reporting. That’s why we offer specialized solutions across a broad set of asset classes and vehicles. With $1.8 trillion in total assets under management,[1] and $56.1 billion on behalf of insurance general accounts,[2] we strive to understand your distinct capital requirements, accounting tax treatment, and risk factors.

Invesco Advisers, Inc. and Invesco Senior Secured Management, Inc. are investment advisers that provide investment advisory services to Institutional Investors and do not sell securities. Invesco Distributors, Inc. is the distributor for Invesco's retail products. Invesco Advisers, Inc., Invesco Senior Secured Management, Inc. and Invesco Distributors, Inc. are indirect wholly owned subsidiaries of Invesco Ltd.

¹ Invesco Ltd. AUM of $1,795.6 billion US as of September 30, 2024
² As of December 31, 2023

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