BlackRock revamps private credit business
BlackRock is revamping its private credit business with the launch of a new division and a management shake-up.
The world’s largest asset manager is setting up a new unit, Global Direct Lending, according to Bloomberg.
It is appointing Stephan Caron, head of its European middle-market private debt business, to lead the division.
Meanwhile, Jim Keenan, the global head of BlackRock’s private debt business who has been at the company for two decades, will be leaving next year, as will Raj Vig, co-head of US private capital, according to the report.
“Private credit is one of the firm’s top priorities,” Rich Kushel, head of BlackRock’s portfolio management group, said in a memo cited by Bloomberg. “This new structure will increase collaboration and alignment as we expand and develop our capabilities while maintaining the discreet investment processes that underpin each franchise.”
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The direct lending unit is being set up in response to increasing demands from investors, Kushel said.
BlackRock manages $10.6tn (£8tn) of assets but only $86bn of that is in private debt, meaning that it is dwarfed by major players in the sector.
By contrast, Apollo Global Management oversees more than $500bn of credit assets, while Ares Management has more than $320bn.
BlackRock’s chief executive Larry Fink has previously said that private credit will be a “primary growth” driver, while the firm’s analysis has forecasted rapid growth in direct lending.
As part of its growth plans, BlackRock is also making inroads into the wealth market. Earlier this month, BlackRock announced that it had partnered with Euroclear to expand the distribution of its private market funds, including its private debt strategies, via Euroclear’s FundsPlace.
And it has teamed up with Partners Group to launch a multi-private markets product that will enable retail investors to access alternative investments, including private debt.
