Ares Acquires Lower-Middle Market Lender Riverside Credit Solutions

Ares Management has completed the acquisition of Riverside Credit Solutions (RCS), a lender in the lower middle market, as it aims to expand its U.S. direct lending strategy. The deal value was not disclosed.

Boston-based RCS, an affiliated fund of The Riverside Company, provides financing solutions to sponsored and non-sponsored companies and has deployed over $700 million across more than 60 investments since inception in 2016, focusing business services, software & technology, and healthcare.

“RCS’ dedicated focus on the lower end of the middle market helps reinforce Ares’ position as a leading direct lender by supporting greater incumbency with quality lower-middle market borrowers as well as expanded deal flow opportunities for our platform,” said Mitch Goldstein, partner and co-head of the Ares Credit Group.

The transaction also includes partner David Dobies, as well as managing directors Tom Gillis and David Kilpatrick.

The new team members will be integrated into Ares’ U.S. direct lending strategy, which is a component of the company’s global direct lending platform that had over $214 billion in assets at the end of the second quarter. The firm also raised $34 billion in commitments for the Ares Senior Direct Lending Fund III at the end of July.

In the Ares’ recent second-quarter earnings presentation, the Ares Credit Group reported $323.1 billion in assets under management, up 22% year-over-year. Realized income was $407.9 million, up 17% from a year ago, making it the most profitable division in the firm.