UK fund manager Intermediate Capital Group has entered the Australian private senior debt market, with the launch of the ICG Australia Senior Loan Fund.ICG has operated in Australia since 2006, specialising in mezzanine finance and leveraged credit. Its new fund, which will be offered to institutional investors, will focus on sub-investment grade middle-market borrowers.It is hoping to raise up to A$1 billion and has set an objective of producing a return of seven to nine per cent a year.ICG has put A$40 million of seed money into the fund, which has already made four loans. The borrowers include the healthcare companies, Healthscope and GenesisCare, and the poultry producer Inghams Enterprises.The manager of the fund, Matthew Turner, said the withdrawal or cutting back by a number of international banks after the financial crisis had left a gap in the Australian debt market.Turner, who was formerly the director of acquisition finance at National Australia Bank, said ICG would work with the big banks on syndicated loan deals. "The banks see us as complementary and they are supportive," he said.Turner said loans in the fund would be senior and secured. Loan terms would be five to seven years, and pricing would be based on floating rates.