Aberdeen raises £233m for new sub-line fund
Aberdeen has raised £233m for the launch of its new subscription line finance fund.
The first tranche of fundraising for the abrdn Private Credit SCSp RAIF – Global Fund Finance Fund was seeded by several European and UK pension funds and family offices.
It brings the total raised for this strategy over the year to date to £527m, with the specialist asset manager running the same strategy for institutional clients on a discretionary basis.
The new fund will invest in a diverse range of investment grade, or equivalent, subscription line facilities, which are loans made to private markets funds, including private equity, private credit, secondaries and infrastructure funds.
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According to Aberdeen, they are commonly used to “bridge” the investment activity of a fund, providing certainty of funding and access to liquidity at short notice.
The latest fund finance offering from Aberdeen’s 20-strong team of private credit investors will spread credit risk across the “uncalled commitments” of a large pool of high-quality, institutional investors, diversified by geography and investor type.
A two-year “lock-in” feature is designed to offer investors a greater level of flexibility relative to other private credit strategies, which Aberdeen said “have a longer tenor”, typically.
To achieve “attractive complexity premia”, Aberdeen’s fund finance team can invest in revolving credit facility (RCF) formats, as well as term loans, extend multi-currency facilities, and offer same-day US dollar funding, all via the asset manager’s private credit operations platform.
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“Momentum continues to build in private credit, as we see asset allocation shifts in favour of specialist private credit strategies,” Marianne Zangerl, deputy global head of fixed income at Aberdeen, said.
“We are focused on areas where we can add significant value for our clients through the generation of an attractive illiquidity premium (the delta between credit spreads in public versus private markets). This premium is still achievable in less well banked/funded areas of the market, and this is a sweet spot for us,” Zangerl added.
Since 2018, Aberdeen’s fund finance team has invested more than £3.8bn into over 60 subscription lines and hybrid transactions and is part of Aberdeen’s wider private credit team, has approximately £10bn of assets under management.
“Investors have been keen to access the market because of the potential for attractive risk-adjusted returns with historically low volatility,” Shelley Morrison, head of fund finance at Aberdeen, said.
“Fund finance also offers valuable diversification thanks to its low correlation with other asset classes.”
