Golub Capital

Golub Capital
Private
Industry
Founded 1994 (1994)
Number of locations
Key people
 Lawrence Golub (CEO)
David Golub (President)
Andrew Steuerman (Head of Middle Market and Late Stage Lending)
Christina D. Jamieson (Head of Broadly Syndicated Loans)
Website Official Website

Golub Capital is an U.S.-focused credit asset manager with over $18 billion of capital under management.[1][2] The firm has primary business lines in middle market lending, late stage lending, and broadly syndicated loans.[3][4][5] The firm is also affiliated with Golub Capital BDC, Inc., a business development company that trades on the NASDAQ under the stock ticker symbol, GBDC.[6][7] Golub Capital is one of the largest non-bank middle market lenders and providers of senior debt.[6][8][9] In 2016, the firm was named "Lender of the Year" by Private Debt Investor.[10]

History

1994–2000: Foundation and early success

Golub Capital was founded in New York City in 1994 by Lawrence Golub. Golub had previously worked at Allen & Company, Wasserstein Perella & Co., and Bankers Trust. He had also been a White House Fellow.[11] The firm initially operated with $20 million of equity capital under management.[12][11] Anchor investors in Golub Capital's first fund included Dan Lufkin (of Donaldson, Lufkin & Jenrette), Stanley S. Shuman (of Allen & Company), and Mellon Bank among others.[13] Golub and an assistant were the only employees at Golub Capital's outset, but, by 2000, the firm had between 8 and 10 employees and a fund worth a couple hundred million dollars.[12][14]

2000–2004: Shift in focus

In 2000, the firm began specializing in mezzanine loans. These loans were geared toward private equity-backed companies. Golub Capital no longer made investments in controlled private equity investments in order not to compete with their private equity clients. In the aftermath of the dot-com bust in 2000, the firm achieved success with its mezzanine loans as most cash flow loans became unavailable.[12][11]

In 2003, David Golub (Lawrence's brother)[11] joined the firm as its President (with Lawrence Golub remaining CEO). Golub had previously been Managing Director of both Centre Partners Management LLC and Corporate Partners.[15] Also in 2004, Andrew Steuerman (previously of Albion Alliance and the New York Life Insurance Company) joined Golub Capital. Steuerman became the head of originations[11] and eventually gained the titles of Senior Managing Director and Head of Middle Market and Late Stage Lending.[2]

2004–2008: Further business expansion

In 2004, Golub Capital began offering senior and one-stop loans. By 2007, the firm was a lead lender and arranger in senior loans.[12] In 2005, on the final closing of its fourth GCP fund (Golub Capital Partners IV), the firm raised $800 million of equity capital. Its fifth GCP fund (Golub Capital Partners V) raised $700 million of equity capital. Golub Capital's total capital under management increased to $2.5 billion as a result.[16][17]

2008–present: Financial crisis and beyond

During the 2008 financial crisis, Golub Capital was one of the few lending firms that continued to grow.[12][11] By the end of 2008, the firm was third by deal volume for lead arrangers of sub-$100 million leveraged buyout loans and had raised $1.5 billion for new loans.[9][11] In 2009, it became the number one bookrunner for leveraged buyout loans in the middle market. By 2010, the firm had $4 billion capital under management.[8]

Golub Capital BDC, Inc. was founded in 2009 and went public in March 2010. It trades on the NASDAQ under stock ticker symbol, GBDC.[14][7] David Golub serves as the CEO and President of Golub Capital BDC.[15]

In 2011, the firm had 120 employees with offices in New York, Chicago, and Atlanta.[11] Their loan portfolio also increased to $5 billion.[18] In 2012, the firm led a targeted campaign to serve lower middle market companies that have an annual EBITDA of between $6 and $8 million.[19]

In 2014, the firm's capital under management increased to $10 billion with the final closings of the Golub Capital Partners VIII fund and the Golub Capital Partners International VIII.[13] That year, the firm closed a mix of deals, including boot retailer Boot Barn with a $100 million facility[20] and fiber optic infrastructure company Wilcon Holdings with a $59 million facility.[21] The firm opened a lending office in San Francisco in 2014 to handle its late stage lending business line.[5] As of 2016, the firm has over $18 billion in capital under management.[1]

Businesses

Golub Capital has three main business lines: middle market lending, late stage lending, and broadly syndicated loans.[3] The firm typically invests in sectors like SaaS, health care, restaurants, business services, and many others.[18][2] The firm is also affiliated with Golub Capital BDC, Inc., a publicly traded (NASDAQ: GDBC) business development company.[14]

Middle Market Lending

Andrew Steuerman heads Golub Capital’s Middle Market Lending team located in Chicago and New York. The business line focuses on providing senior, one-stop, and second lien debt to U.S. middle market companies, typically controlled by private equity firms.[13][11] Golub Capital can hold over $300 million in each middle market lending deal, and the team can also underwrite and syndicate senior credit facilities and a proprietary suite of one-loan debt facilities of up to $750 million.[22] The typical borrower generates between $5 million to $50 million a year in EBITDA and is backed by one of over 200 private equity companies with which Golub Capital has a working relationship.[19] Approximately 85% of financings done with private equity companies come from pre-existing relationships.[13]

Late Stage Lending

The firm's late stage lending unit is also headed by Andrew Steuerman.[2] The team operates out of the firm's San Francisco office in order to be closer to Silicon Valley.[3] The business offers debt to fast-growing technology companies backed by venture capital, growth equity, private equity, or other private companies.[3][5]

Broadly Syndicated Loans

Golub Capital's Broadly Syndicated Loans group is headed by Christina Jamieson in the firm's Chicago office.[8][13] This unit focuses on investing in larger loans that are generally liquid in the secondary market. The Broadly Syndicated Loans team also manages a series of collateralized loan obligations.[23]

Golub Capital BDC, Inc.

Golub Capital BDC, Inc., (a business development company) was founded in 2009 and went public in March 2010 NASDAQ: GBDC.[14] David Golub serves as the President and CEO of the company.[15] The company lends money to middle market companies that have backing from private equity firms.[24]

Recognition and awards

Golub Capital has received substantial industry recognition since 2009. Most recently, in 2016, it was awarded "Lender of the Year, Americas," "Senior Lender of the Year, Americas," and "Business Development Company of the Year" by Private Debt Investor.[25] In 2015, Private Debt Investor named Golub Capital "Lender of the Year" and "Unitranche Lender of the Year."[10] Also in 2015, Golub Capital BDC, Inc. was named "Best Business Development Company" by Creditflux.[26][27] In 2014, the firm was recognized by Private Debt Investor as the 10th largest private debt fund manager.[28] In 2012, Golub Capital was named the "Lender Firm of the Year" by both M&A Advisor and ACG New York.[29] Buyouts Magazine named Golub Capital the "Middle Market Lender of the Year" in 2009 and 2010.[8][12] Mergers & Acquisitions named Golub Capital that "Debt Financing Agent of the Year" also in 2010.[12] In 2009, Mergers & Acquisitions named Golub Capital the "2008 Lender of the Year."[30]

References

  1. 1 2 Monga, Vipal (8 July 2016). "Higher Gas Prices Hit Profits at Consumer Mid-Market Firms". The Wall Street Journal. Retrieved 16 August 2016.
  2. 1 2 3 4 "Company Overview of Golub Capital". www.bloomberg.com. Bloomberg. Retrieved 13 September 2015.
  3. 1 2 3 4 Collins, Allison (27 October 2014). "Finance Finesse: Golub Grows Tech Lending Unit". Mergers & Acquisitions. Retrieved 13 September 2015.
  4. ↑ "Golub Capital Opens San Francisco Office As Part Of Its Expansion Into Late Stage Lending". PR Newswire. 2 December 2009. Retrieved 13 September 2015.
  5. 1 2 3 "Golub Capital Opens San Francisco Office As Part Of Its Expansion Into Late Stage Lending". PR Newswire. 16 September 2014. Retrieved 13 September 2015.
  6. 1 2 Wroblewska, Anna (26 June 2014). "The Secret to Golub Capital BDC Inc's Success". The Motley Fool. Retrieved 13 September 2015.
  7. 1 2 "Golub Capital BDC, Inc. Stock Quote & Summary Data". www.nasdaq.com. NASDAQ. Retrieved 13 September 2015.
  8. 1 2 3 4 "Golub Moves To Number One On The League Tables". Buyouts. 2010. Retrieved 13 September 2015.
  9. 1 2 Lattman, Peter (24 August 2009). "Golub Takes Lead in Leveraged Buyouts". The Wall Street Journal. Retrieved 13 September 2015.
  10. 1 2 "Golub Capital Named Lender of the Year and Unitranche Lender of the Year by Private Debt Investor". PR Newswire. 4 March 2015. Retrieved 13 September 2015.
  11. 1 2 3 4 5 6 7 8 9 Frumes, Max (9 May 2011). "Anatomy of a Middle Market Lender" (PDF). The Deal. Retrieved 14 September 2015.
  12. 1 2 3 4 5 6 7 Papavassiliou, Stuart P. (October 2010). "Golub Capital — Unique in Every Aspect". ABF Journal. Retrieved 13 September 2015.
  13. 1 2 3 4 5 Donde, Anastasia (September 2014). "Capital Talk: Golub Capital". Private Debt Investor (16): 28–33.
  14. 1 2 3 4 Wroblewska, Anna (7 July 2014). "How Golub Capital BDC Inc Built a Hurricane-Proof Balance Sheet". The Motley Fool. Retrieved 13 September 2015.
  15. 1 2 3 "David B. Golub". www.bloomberg.com. Bloomberg. Retrieved 13 September 2015.
  16. ↑ "Golub Capital Has a Year to Remember". Buyouts. 6 March 2006.
  17. ↑ Dzikowski, Don (21 October 2006). "Change in Bank Rules could Spawn New Middle Market CLOs". The Secured Debt Report. 2 (19).
  18. 1 2 "Pockets of Credit". The Economist. 19 November 2011. Retrieved 14 September 2015.
  19. 1 2 "Reluctant Optimist". Grant's Interest Rate Observer. 30 (21b). 2 November 2012.
  20. ↑ Collings, Richard (21 October 2014). "Private Equity-Backed Boot Barn Has Set Terms for its IPO". TheStreet.com. Retrieved 14 September 2015.
  21. ↑ Schwarzberg, Jonathan (29 October 2013). "Golub supplies $59M in financing for Freedom Dark acquisition". The Deal. Retrieved 14 September 2015.
  22. ↑ "Revenue in the U.S. Middle Market Continues to Expand at a Healthy Pace of 7.4%". Business Journals. 7 July 2016. Retrieved 16 August 2016.
  23. ↑ "Kenneth Selle Joins Golub Capital As Head Of Loan Trading In Its Broadly Syndicated Loans Group". PR Newswire. 8 January 2015. Retrieved 14 September 2015.
  24. ↑ Wroblewska, Anna (10 July 2014). "How Does Golub Capital BDC Make Money?". The Motley Fool. Retrieved 14 September 2015.
  25. ↑ "Golub Capital Named Lender of the Year and Unitranche Lender of the Year by Private Debt Investor". The Street. 4 March 2015. Retrieved 16 August 2016.
  26. ↑ "Golub Capital BDC Awarded Best Business Development Company". ABF Journal. 8 May 2015. Retrieved 2 October 2015.
  27. ↑ "Golub Capital BDC, Inc. Awarded "Best Business Development Company" by Creditflux". PR Newswire. 7 May 2015. Retrieved 2 October 2015.
  28. ↑ "Special Report: The PDI 30" (PDF). www.privatedebtinvestor.com. Private Debt Investor. Retrieved 14 September 2015.
  29. ↑ "Golub Capital BDC, Inc. Announces New Partner in Senior Loan Fund LLC". PR Newswire. 15 August 2014. Retrieved 14 September 2015.
  30. ↑ MacFadyen, Ken (1 May 2009). "Lender of the Year". Mergers & Acquisitions. Retrieved 13 September 2015.

External links

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