Fund Finance

The credit manager said economic conditions were causing private equity managers to seek additional funding for their portfolios.

The deal, expected to close this year, will bring new capital to the CLO platform as Principal and Nippon exit.

Generating alpha and being able to quickly put capital to work are key advantages of fund finance, says Matt Hansford, European head of Barings Portfolio Finance.

Lenders are responding to an increase in non-institutional investors and semi-liquid vehicles, while GP borrowers are opening up to new sources of fund finance, say Edward Beecham and Megan Livingstone of Alpha Fund Finance.

An expanding borrower universe and new entrants on the lending side are driving innovation in fund finance, according to Meyer Dworkin, head of fund finance and structured credit; David Kennedy, partner; and Kwesi Larbi-Siaw, counsel at Davis Polk & Wardwell.

A difficult M&A market means private equity funds are holding portfolio companies for longer, but NAV finance could turn this into an opportunity.

Net asset value lending has evolved to require more disclosures and alignment with investors.

GPs are turning towards NAV financing as the market demands more flexible solutions and offers diversification for investors, says Arcmont’s head of NAV Financing, Peter Hutton.

Given changing attitudes to ESG, PDI explores whether sustainable loan structures still have a future in the world of fund finance.

Rated subscription lines and NAV loans are a strongly performing area, says Thomas Speller, senior managing director, global head of fund finance at KBRA.