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Business deals

Orix to buy US commercial lender NXT Capital

Deal worth $900m-plus gives Japanese company an edge in acquisition financing

Orix already generates one-quarter of its profit overseas.

TOKYO -- Orix will acquire NXT Capital, a Chicago-based commercial financing specialist, in August in a deal likely to exceed 100 billion yen ($903 million).

The U.S. lender provides financing for so-called middle-market acquisitions both directly and through private debt funds managed on behalf of investors. It has more than $5 billion of assets under management. Established in 2010, NXT Capital will become a wholly owned unit of Orix.

With the strong American economy stoking acquisitions, financing for leveraged buyouts of midsize companies has reached $360 billion a year in the U.S., according to some estimates. Even as interest rates rise, observers expect continued activity in leveraged buyouts.

Orix has diversified from leasing to become a financial services group involved in areas such as real estate and investment in unlisted companies. Overseas profit accounts for one-quarter of the Tokyo-based group's total, with the U.S. business becoming a top earner on the strength of real estate financing and corporate lending. Orix already has a presence in the leveraged buyout financing market there.

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