PGIM to invest “significant dollars” in private alternatives
PGIM is set to invest “significant dollars” in private alternatives, as it seeks to acquire an asset manager that can help it expand its influence in the sector.
Taimur Hyat, chief operating officer at PGIM, told Nikkei Asia that the firm is “looking non-organically to see how to build our private alternatives capabilities.”
It comes just months after PGIM launched an alternatives division as part of an overall organisational restructuring effort. The new division covers real estate, infrastructure debt and private credit.
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By the end of September 2023, PGIM held $1.2trn (£0.92trn) in assets, including approximately $310bn under advisory and management in the private market alternatives market.
Hyat said that PGIM anticipates growth in the private alternatives market in the year ahead.
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“At some point, in a high interest rate environment, stresses build up, whether in the US or Europe,” he said.
“If there is a stress or recession [ahead], it will differentiate people with experience managing downturns from the new entrants who don’t have the track record.”
PGIM is also keen to offset any potential losses stemming from the US Federal Reserve’s recent rate hikes.
During the first three quarters of 2023, PGIM saw outflows of $24.6bn as a result of rising rates. However, Hyat said that he believes the end stage of outflow will be over within the next 24 months.
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