Aberdeen collects £233 million for a new subsidiary investment fund
In the realm of private credit strategies, Aberdeen's fund finance activities are gaining traction, as noted by Marianne Zangerl, the deputy global head of fixed income at Aberdeen. The focus is on areas where the team can generate an attractive illiquidity premium, particularly in less well-banked or funded areas of the market.
Aberdeen's wider private credit team manages approximately £10bn in assets. The new fund, named the abrdn Private Credit SCSp RAIF – Global Fund Finance Fund, is set to invest in investment-grade (or equivalent) subscription line facilities. These are loans made to private markets funds such as private equity, private credit, secondaries, and infrastructure funds.
The strategy for this fund includes spreading credit risk across a large and diversified pool of uncalled commitments from high-quality institutional investors, diversified by geography and investor type. The fund will invest only in high-quality, investment-grade assets, applying Aberdeen’s proprietary internal credit rating process, enhanced by methodologies from major rating agencies.
The fund offers greater investor flexibility through a shorter two-year lock-in period compared to other private credit funds, and includes reinvestment options. It also utilizes the ability to extend loans as Revolving Credit Facilities (RCFs), providing more flexible financing structures attractive enough to command a pricing premium.
The fund's credit risk will be managed with robust risk controls, and it will be managed by Aberdeen’s dedicated fund finance investment professionals supported by in-house private credit operational and legal teams. Since 2018, Aberdeen’s fund finance team has invested more than £3.8bn into over 60 subscription lines and hybrid transactions.
The fund's initial close raised £233 million, seeded by European and UK pension funds and family offices. Geographically, the fund is initially available to institutional investors in several European countries, with plans to expand access including Asia and the US, and will offer feeder options in multiple currencies (EUR, GBP, USD).
Shelley Morrison, head of fund finance at Aberdeen, commented on the interest in the market, stating that fund finance offers valuable diversification thanks to its low correlation with other asset classes. The fundraising for the abrdn Private Credit SCSp RAIF - Global Fund Finance Fund was seeded by several European and UK pension funds and family offices.
The latest fund finance offering from Aberdeen's private credit team has a two-year "lock-in" feature. This new fund provides certainty of funding and access to liquidity at short notice, making it an attractive proposition for investors keen to access the market due to the potential for attractive risk-adjusted returns with historically low volatility.
The new abrdn Private Credit SCSp RAIF – Global Fund Finance Fund, managed by Aberdeen, focuses on investing in subscription line facilities for high-quality, investment-grade assets, primarily in private equity, private credit, secondaries, and infrastructure funds. This fund offers a shorter two-year lock-in period, providing investors with greater flexibility and access to liquidity.
Businesses seeking investment-grade financing can look to the Global Fund Finance Fund, which utilizes revolving credit facilities to offer more flexible financing structures, attracting a pricing premium. The fund's risk management strategy includes robust controls, and it is managed by Aberdeen's dedicated fund finance investment professionals.
