Duke Street Capital Debt Management has held a €450m ($541m) final close on Duchess III, its third collateralised debt obligation fund and the first raised since the business was sold to Babson Capital Management in May this year.

The fund, which is already more than 65% invested, will focus on senior secured and mezzanine loans within the leveraged finance market. The fund has a target mix of 80% senior secured loans and 20% mezzanine, with all assets rated by both Standard & Poor's and Moody's.