Founded in 1980, General Atlantic has $73 billion in assets and offices around the world. Under Chief Executive Bill Ford, the firm has made its name by taking minority stakes in fast-growing companies such as Alibaba Group Holding Ltd. before their initial public offerings.

The deal solidifies a partnership that has been more than two years in the making. General Atlantic launched a joint venture with Iron Park in 2020, with the firms teaming up to raise a vehicle that would provide structured-equity and debt financing to companies affected by the Covid-19 pandemic.

The pair had initially targeted more than $5 billion for the fund, but ended up splitting that between two vehicles, the first of which closed during the summer of 2021 at $2.2 billion. That fund, known as Atlantic Park I, has been fully invested across 13 different companies in areas like healthcare, financial services and technology where General Atlantic has expertise. Atlantic Park is in the process of raising the second vehicle, according to people familiar with the matter.

The market disruption that General Atlantic and Iron Park expected would come in the immediate aftermath of the pandemic turned out to be short-lived, but the executives said the venture found opportunities financing deals that were too complex or too small for some of the biggest private lenders.

Current market conditions, characterized by high inflation, rising interest rates and banks that have all but stopped making new buyout loans, have made private credit an even more attractive area of investment. Firms with money to lend have been able to charge higher interest rates and get stronger protections.

“I think we are entering into one of the best environments to invest in credit since the global financial crisis,” said Mr. Smith. He said it helps that Iron Park, which launched in 2019, has few legacy assets and can focus on new investment opportunities, which could include rescue financing.

Mr. Smith is the “S” in GSO Capital Partners, the credit-investment firm he co-founded in 2005 that was sold to

Blackstone Inc.

three years later. GSO is now the backbone of Blackstone’s credit-investing business, which has $269 billion in assets. He left Blackstone in 2018.

The Atlantic Park funds comprise the bulk of Iron Park’s assets under management, but the firm also has public-credit strategies. In total, it manages about $4 billion in assets.

For General Atlantic, buying a credit business will bring it into a growing asset class at a time when fundraising for private-equity investing has become more challenging across the board.

Mr. Ford added that Atlantic Park has been able to build deep relationships with buyout firms in need of capital to do deals, in part because they don’t see General Atlantic as a competitor.

“It’s very enhancing to our overall platform,” he said.

Write to Miriam Gottfried at Miriam.Gottfried@wsj.com