Ares Capital to Acquire MidCap Financial Investment for $2.5 Billion

Ares Capital Corp. is acquiring MidCap Financial Investment Corp., a publicly traded business-development company valued at $2.5 billion, from Apollo Global Management. The transaction will be funded through a combination of cash and stock, with the deal expected to close in the first half of 2027. Upon completion, shareholders of MidCap Financial Investment Corp. will own approximately 5% of the merged funds.

Apollo Global Management decided to auction the fund after it underperformed amid a broader selloff in private-credit funds fueled by default fears. While Apollo is selling the investment fund, it will retain MidCap Financial, the larger corporate lending business responsible for originating the loans.

The acquisition expands the total investments of Ares Capital to over $31 billion and adds 200 new borrowers to its portfolio. This move allows Ares to acquire loans at a significant discount to their net asset value.