3i takes on debt management business in the United States

Marion Dakers
PRIVATE equity group 3i yesterday established a debt management business in the United States, taking its fast-growing debt arm past £6.5bn in assets under management.

The firm has teamed up with US firm WCAS Fraser Sullivan to establish the business, which will manage or advise 25 funds with exposure to the country’s credit market.

London-listed 3i was set up after World War Two to play a role in financing reconstruction of Britain, but in the last couple of years has been shifting its focus to debt and infrastructure investment in light of disappointing private equity returns.

3i will hold an 80 per cent equity interest in the new subsidiary, with the rest held by Fraser Sullivan execs. The group expects to take full control after three years.

Simon Borrows, 3i’s chief executive, said: “Our debt management business now has significant scale across both Europe and the US, and we look forward to further growing this business, both organically and though acquisition, as opportunities arise.”