Nasdaq-listed StepStone has teamed up with Dubai-based asset and wealth management firm ASB Capital to launch a Shari’ah-compliant lending fund.

The ASB StepStone Private Financing Fund will focus predominantly on senior secured financing to US middle-market companies. It is being structured as an open-ended, perpetual vehicle, which will provide “flexibility around subscriptions” and redemptions.

ASB Capital, which has $10.2bn (£7.7bn) in assets under management, said the partnership marks a step in its expansion into private markets and responds to demand for Shari’ah-compliant, income-generating alternatives.

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“The ASB StepStone Private Financing Fund represents a significant milestone in the development of our private markets platform,” said Rafik Nayed, managing director of ASB Capital. “Investors are increasingly seeking actively managed income-generating strategies that can diversify their portfolios beyond traditional assets.”

The partnership combines ASB Capital’s regional reach and product range with StepStone’s global private markets investment platform, which has around $245bn in assets under management.

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“We are pleased to partner with ASB Capital, one of the region’s fastest growing asset managers, to make a diversified private financing strategy available to investors, combining our global private-markets capabilities with ASB Capital’s reach and expertise,” said Hans-Jörg Baumann, chairman and founding partner of StepStone Private Debt.

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