Alternative asset manager Investcorp has snapped up venture capital group 3i's global credit business for £222m.
Purchasing 3i Debt Management (3iDM), a business with $12bn of assets under management, will almost double Investcorp's portfolio.
Simon Borrows, the chief exec of 3i explained that although the debt management business provided strong cash flows, strategically it was no longer the best fit for the group.
"[T]he division fits less well with the 3i of today as we focus on our growing infrastructure business and a proprietary capital approach in private equity," he said.
3iDM was formed out of 3i's purchase of Mizuho investment management in 2011 and was grown through the acquisition of specialist US debt manager WCAS Fraser Sullivan Investment Management, as well as adding a portfolio of collateralised loan obligations from Invesco.
"This is a milestone deal which will bring together two complementary businesses," said Mohammed Al Ardhi, executive chairman of Investcorp.
Meanwhile, co-chief exec of Investcorp, Rishi Kapoor, hailed the sale as win-win situation: "This is an exciting moment for us – we see this as a value-added transaction for all sides which will be accretive for Investcorp from day one."