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Bailey McCann, Opalesque New York:

GSO Capital Partners has acquired a $2.4 billion credit investment portfolio from NewStar Financial. Funding for the acquisition came from GSO's newly raised $950 million Diamond Portfolio Fund. Immediately following the sale, NewStar was acquired by First Eagle Investment Management, a privately owned investment firm with $116 billion in assets under management.

NewStar Financial is a middle market direct lending company. The firm has had a strategic relationship with GSO since 2014. The scope of that relationship included a long-term investment in NewStar as well as direct investment in the firm's managed funds and co-lending activities.

In 2015, NewStar acquired FOC Partners, a boutique credit-oriented investment manager, and its $2 billion credit investment portfolio. NewStar's credit portfolio includes corporate loans and other credit investments.

GSO's Diamond Portfolio Fund closed in November of this year after just two months in market and is focused on finding opportunistic credit investments.

The NewStar transaction follows an announcement from GSO earlier this month, noting that the firm would be integrating its direct lending business and concluding its relationship with FS Investments' funds as of April 2018. GSO has been involved with direct lending through FS Investments for more than a decade. In a statement, GSO noted FS Investments outperformance over the life of the relationship. GSO pl......................

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