PennantPark Floating Rate Capital Ltd. (PFLT) has partnered with a fund managed by Hamilton Lane (HL) to form PennantPark Senior Secured Loan Fund II (PSSL II), LLC, a joint venture aimed at investing primarily in middle market loans aligned with PFLT’s core origination and underwriting strategy. 

Under the agreement, PFLT and HL will contribute a combined $200 million in notes and equity—$150 million from PFLT and $50 million from HL. PSSL II also plans to secure a $300 million financing facility, enabling the portfolio to initially scale to $500 million. Investments in the new joint venture’s portfolio are expected to begin in late September or early October. 

“This new joint venture is another strategic step to broaden our impact as a meaningful core middle market direct lender and will expand our ability to provide senior loan solutions to core middle market sponsor and borrower clients,” said Arthur H. Penn, CEO of PFLT. “Growing PSSL II should lead to a higher return on equity and net investment income per share at PFLT.” 

“We are proud to deepen our longstanding partnership with PennantPark through this new joint venture, focused on what we believe to be high-quality middle-market credit opportunities,” added Nayef Perry, Head of Direct Credit at Hamilton Lane. 

PFLT, a business development company, primarily invests in U.S. middle-market private companies through floating rate senior secured loans, including first lien, second lien, and subordinated debt, with occasional equity investments. The firm is managed by PennantPark Investment Advisers, LLC.