This is Ares testing depth, not just appetite, in Europe’s private credit CLO market because it came back with a second deal inside a year and still cleared at scale.
Ares Management has priced Ares European Direct Lending CLO II at over EUR 300 million, according to PE Insights, after the transaction was initially cited at EUR 340.1 million. The deal is a funding transaction in financial services and was recently announced.
What happened
- Issuer/manager: Ares Management
- Vehicle: Ares European Direct Lending CLO II
- Size: *over* EUR 300 million (reported), rather than EUR 340.1 million
- Timing: priced less than a year after Ares’ inaugural European Direct Lending CLO
The quick return matters. In a market where new structures often arrive with fanfare but limited follow-through, Ares is putting repeat issuance on the board. That is typically the point at which a niche product starts to look like a financing channel.
Why it matters
European private credit has been searching for durable, repeatable capital markets outlets. A second Ares deal in under a year suggests that investors are not only willing to underwrite the concept of European direct lending CLOs, but are also prepared to do it again without a long cooling-off period.
The CLO II is also described as among the first multi-currency middle-market CLOs in Europe, a structuring choice that reads as pragmatic rather than experimental. Multi-currency capability broadens the addressable borrower set and can widen the buyer base for liabilities, but it also introduces extra layers of execution complexity around hedging and documentation.
Ares is not coming to this market as a tourist. Its European Direct Lending platform managed over USD 84 billion in assets as of December 31, 2025, and since 2007 has completed more than 420 investments totaling over EUR 80 billion. That track record supports repeat issuance because investors can anchor their underwriting in an established origination engine and historical portfolio behavior.
Execution reality and watchpoints
The headline signal is constructive, but the risks sit where they always do in CLOs: collateral quality, documentation, and the manager’s ability to protect downside through the cycle.
- Repeatability vs. one-off: Pricing a second deal is a step toward an issuance programme, but the market will judge consistency across vintages and performance in stress.
- Multi-currency complexity: Innovation can broaden demand, but it can also amplify basis and hedging risks if volatility rises.
- Information gaps on regulation: Available sources do not connect this transaction to Basel IV or specific EU regulatory timelines. The deal should be read primarily as a market-driven funding move, not a regulation-led trade.
Broader platform signal
Alongside CLO II, Ares is also reported to be preparing a new sports, media, and entertainment investment fund aimed at European investors, pointing to a wider push to scale its European alternatives footprint. Taken together, the message is that Ares is building multiple product lanes for European capital, rather than relying on a single strategy to carry fundraising momentum.
For the European direct lending CLO market, the near-term takeaway is simple: repeat issuance from a large platform helps standardise the product and can pull more investors into the category. The next test is whether more managers can follow with comparable size and cadence, turning early momentum into a settled part of Europe’s private credit funding stack.