Century City private equity firm Ares Management announced Thursday that it had bought Tarrytown, N.Y. lender Keltic Financial and would be using the acquisition to make more asset-based loans to small and mid-sized companies.

As part of the acquisition, Ares formed a new division called Ares Commercial Finance within the firm’s larger Direct Lending Group. The Direct Lending division contributes nearly 40 percent of Ares’ total fee revenue.

“The expansion of our Direct Lending Group into attractive new subsectors of the small and middle market continues to be a meaningful part of our growth strategy,” Michael Arougheti, a senior partner at Ares, said in a press release. “We see the acquisition of Keltic as an appealing market opportunity to execute on this strategy.”

Ares earned $63 million in net income on revenue of $146 million for the three months ended Dec. 31. It had $74 billion in assets under management at the end of last year.

Ares’ chief executive, Antony Ressler was No. 42 on the Business Journal’s most recent list of Wealthiest Angelenos.