Investment giants deepen their influence in the private debt space
Investment giants such as Schroders, M&G and Fidelity have been deepening their influence in the private debt space with a number of new product launches in recent months.
In a sign that the private debt market is becoming more popular, a slew of new funds and services have been rolled out in the UK, Europe and US.
Last month, Schroders announced that it was centralising its private debt and credit alternatives strategies into a new business unit. The newly-formed Private Debt and Credit Alternatives (PDCA) business comprises real asset debt, structured and corporate credit, speciality finance and impact lending. It already has more than $30bn (£24.41bn) in assets under management with more than 100 investment professionals overseeing the portfolio.
Georg Wunderlin, global head of private assets at Schroders Capital, said that the new department was created in response to high demand from investors.
“Global macroeconomics combined with the credit cycle are providing strong tailwinds particularly for debt and credit strategies,” he said.
Read more: Smaller firms taking out more finance after decline in 2022
“The private debt total market is estimated at around $23 trillion, but only some six per cent is currently served by private credit managers, leaving plenty of room for growth.”
Meanwhile, earlier this week M&G Investments unveiled a new fund targeting opportunities in the fast-growing private credit space, with £500m committed ahead of the launch. And last month, global asset manager Fidelity International launched its first direct lending fund focusing on senior secured mid-market loans in Europe.
They join established players in the private debt market such as Blackstone and BlackRock, which both debuted private debt funds earlier this year.
Arcmont Asset Management, Ares Management and Goldman Sachs are all said to be mulling new private debt products to tap into the lucrative market, as more and more investment houses spot the opportunity in private debt.
Read more: Kennedy Lewis launches third opportunistic credit fund with $4.1bn
