Centerbridge teams up with Wells Fargo to launch direct-lending fund

Sept 26 (Reuters) - Private equity firm Centerbridge Partners is launching a direct-lending fund with backing from Wells Fargo, the companies said on Tuesday.

The direct-lending market is dominated by private equity firms, which in recent months have been looking to expand their footprints in the sector as mid-sized banks tighten loan standards.

The fund named Overland Advisors will target at least $5 billion in investible capital with a focus on meeting credit requirements of North American mid-sized companies, the San Francisco-based bank and Centerbridge said.

The companies added that the lending would primarily be in the form of senior secured loans to non-sponsored clients.

Abu Dhabi Investment Authority and British Columbia Investment Management Corporation have agreed to provide nearly $2 billion in initial equity commitments.

Bigger banks have also started dipping their toes in the sector to grab a slice of the lucrative market. Earlier this year, JPMorgan Chase forayed into the direct lending business by setting aside at least $10 billion, Reuters reported, citing a person with knowledge of the matter.

(Reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Shweta Agarwal)