Ares Management – a leading global alternative investment manager – recently announced the final closing of Ares Pathfinder Fund II, L.P. and Ares Pathfinder Fund II (Offshore), L.P. (and together with parallel vehicles Pathfinder II) at $6.6 billion in commitments. This fund was oversubscribed and closed at its hard cap, which exceeded its $5 billion target and was approximately 80% larger than the predecessor fund with a total commitment of $3.7 billion. The fund held its final closing only seven months following its first closing in March 2023.
With Pathfinder II, the Alternative Credit team pursues a differentiated strategy of providing scaled solutions tailored to owners of large, diversified portfolios of assets that seek to generate resilient, contractual cash flows across market cycles. And as of June 30, 2023, the Ares Alternative Credit strategy is one of the largest investors in asset-based credit, managing approximately $27.8 billion in assets under management, including the Pathfinder family of funds.
The Pathfinder family of funds also has a predefined structure of unique social impact purpose. Ares and Pathfinder’s portfolio managers have pledged to donate at least 5-10% of the carried interest profits from the funds to global health and educational charities. And Ares partners with non-profit organizations with an identified track record of delivering high value per charitable dollar contributed. Since inception in March 2021, the Ares Pathfinder family of funds have raised approximately $15 billion in LP commitments with a charitable tie-in and our charitable pledge has already accrued more than $13 million of donations for charity based on performance as of June 30, 2023. This translates into the potential to generate between $10 million and $20 million, respectively, for every $1 billion of capital that earns a 1.5x to 2x multiple in the closed-end Pathfinder funds.
KEY QUOTES:
“We are deeply grateful for the continued support from our investors. In our view, their trust and confidence in Ares Alternative Credit is a testament to the team’s success in executing on their behalf and creating value across a range of market and economic environments. Especially in these times of growing opportunity but also increasing uncertainty, we believe that our strategy benefits from diversified asset portfolios with meaningful downside protections. As many banking participants grapple with new capital and liability paradigms, we see significant potential for the Fund given its scale and flexibility.”
— Keith Ashton, Partner and Co-Head of Alternative Credit
“Our Pathfinder family of funds seek attractive risk-adjusted returns for our investors in a differentiated private credit strategy and create a real impact by donating a portion of the profits to global health and education initiatives. When investors commit to our funds, they gain access to one of the largest and most seasoned teams in alternative credit, while having the opportunity to make a difference to impoverished communities around the world.”
— Joel Holsinger, Partner and Co-Head of Alternative Credit
