Private Debt Investor Special Report
Private Debt Investor Special Report
COVER STORY
THE METHODOLOGY
How we determine the 2014 ranking
The PDI 30 ranking is based on the amount of capital raised by private debt investment
programmes over a roughly five-year period. This year, the five-year window spans from
1 January 2009 until 1 June 2014.
Accuracy, confidentiality
We give highest priority to information that we receive from or confirm with the private
debt fund managers firms themselves. When private debt fund managers confirm details,
we seek to trust but verify. Some details simply cannot be verified by us, and in these
cases we defer to the honour system. In order to encourage cooperation from private
debt fund managers that might make the PDI 30, we do not disclose which firms have
aided us on background and which have not.
Lacking confirmation of details from the firms themselves, we seek to corroborate information
using firms websites, press releases, news reports, limited partner disclosures, etc.
Definitions
Private Debt: For the purposes of the PDI 30, the definition of private debt is capital
committed by investors to a dedicated programme of investing in the debt of private
companies, or the debt financing of leveraged buyouts, infrastructure projects and
real estate. This includes all elements of the capital structure except equity, including
senior, unitranche and mezzanine investments. Asset-backed lending, distressed debt or
credit-oriented special situations funds are also included, as are Business Development
Companies (BDCs).
Capital raised: This means capital definitively committed to a private debt investment
programme. In the case of a fundraising, it means the fund has had a final or official
interim close after 1 January 2009. You may count the full amount of a fund if it has
a close after this date. And you may count the full amount of an interim close (a real
one, not a soft-circle) that has occurred recently, even if no official announcement has
been made. We also count capital raised through other means, such as co-investment
vehicles, deal-by-deal co-investment capital, publicly traded vehicles, recycled capital,
and earmarked annual contributions from a sponsoring entity.
COVER STORY
Rank
Firm
Headquarters
Five-Year Fundraising
Total ($m)
Dallas
28,000
Los Angeles
23,037
New York
21,957
New York
20,097
London
19,870
New York
15,155
New York
14,049
New York
13,830
New York
11,300
10
Golub Capital
Chicago
11,228
11
Washington DC
11,054
12
Ares Management
Los Angeles
10,277
13
Paris
10,213
14
New York
9,575
15
London
9,355
16
New York
8,175
17
Newport Beach
8,070
18
London
7,990
19
Los Angeles
6,712
20
Angelo Gordon
New York
6,684
21
Boston
6,443
22
Boston
5,874
23
Alpharetta
5,868
24
New York
5,439
25
TCW Group
Los Angeles
5,311
26
CarVal Investors
Minnetonka
5,028
27
Medley Capital
New York
4,748
28
Greenwich, CT
4,491
29
TPG
Fort Worth
4,300
30
Varde Partners
Minneapolis
4,150
COVER STORY
FEATURE
In the limelight:
Lone Star founder
John Grayken
Rank
Institution Name
8,138
6,300
6,267
Ares Management
5,476
4,651
3i Debt Management
4,382
4,145
3,700
(Including ICG-Longbow)
9
3,374
10
Neuberger Berman
2,170
COVER
FEATURE
STORY
Oaktree founder
Howard Marks
Last years top firm has slipped to third as the funds it raised in 2008
fall out of the five year window for inclusion, but its a safe bet that
Apollo will be back with a bang next year.
Credit investing is integral to the Leon Black-led firms DNA. Indeed
its credit operations grew to $106 billion at the end of June (against
total assets of $168 billion), compared to $62 billion at the same point
last year. Its the fastest-growing part of the business.
Speaking on a recent earnings call, co-founder and senior managing
director Joshua Harris remarked: Were continuing to operate amid
a backdrop of three major credit themes, which will go on for a long
time, including the impact of secular change from financial re-regulation,
the deleveraging of bank balance sheets globally, particularly in Europe
and continued investor demand for yield and opportunistic credit in
a low-rate environment.
GSO co-founder
Bennett Goodman
Blackstone, has developed a wide range of credit-related products, in common with the other large managers in this ranking.
GSOs custom strategies account for $23.5 billion of its assets,
while it also manages $23.5 billion of CLO capital, $7.7 billion of
mezzanine funds, $8.7 billion of rescue lending funds and $9.3
billion of credit-related hedge funds.
Blackstone president Tony James has also spoken vociferously
of the merits of private debt, or market-based lending as he
put it in a persuasive letter to the Wall Street Journal earlier this
year. Evidently, Blackstone believes private debt will continue to
be an integral part of its business for years to come. n
S eptem ber 2014 | Private Debt Investor 23
COVER STORY
FEATURE
The firm has raised $19.9 billion over the last five years, and
much of that has come through managed accounts. It helps perhaps to have the backing of a brand-name insurer like Prudential
behind it, but M&G has grown into a thriving and reliable asset
manager in its own right.
Because of its scale, its able to compete with banks, offering
longer tenors and bigger tickets than traditional lenders are
able to offer.
Were now in a position where we look at the money that
we manage on behalf of Prudential, together with the third
party client money, and we can contemplate half a billion, even
a billion pound transaction without syndicating it, taking it in
its entirety, Pilcher explained. With firepower like that, M&G
should be considered a serious player. n
European Ranking
Global Ranking
Institution Name
Headquarters
London
19,870
12
Paris
10,213
15
London
9,355
18
London
7,990
34
Ardian
Paris
3,831
37
Stockholm
3,148
41
London
2,880
53
ECS Capital
Lisbon
2,177
56
Cheyne Capital
London
2,004
10
57
Idinvest Partners
Paris
1,918
COVER
FEATURE
STORY
Oak Hill Advisors, founded in 1991, now manages more than $23
billion across its suite of funds, which included distressed debt, creditfocused hedge funds, specialty credit vehicles and managed accounts.
Led by founder and chief executive Glenn August, the firms
senior team is rounded out by three senior partners: president
William Bohnsack, portfolio manager Scott Krase, and chief investment officer Robert Okun. It has offices in New York, London,
Sydney, and Fort Worth, Texas, and opened a fifth in Los Angeles
in January this year.
The firm closed a $1.2 billion distressed US mortgage fund
Along with the likes of Lone Star, Cerberus has become one of the
go-to firms when it comes to the sale of large loan portfolios. In July
this year, the firm snapped up a large portion of NABs UK commercial
real estate loan book for about 625 million.
In April, Irelands National Asset Management Agency (NAMA)
sold a portfolio of loans worth 4.5 billion to the US group, the
largest disposal yet by the countrys bad bank. In December, the
group bought almost 1 billion of non-performing loans from UniCredit. And in November, it paid 1 billion to Lloyds Banking Group
to acquire its Project Bravo and Project Charlie loan portfolios.
Having raised $13.8 billion over the last five years, Cerberus has
had plenty of firepower at its disposal, and with banks worldwide
continuing to deleverage and offload non-core assets, its deal pipeline
is unlikely to taper off any time soon. n
Breaking into the top 10, having placed 27th last year, Golub Capital
is a firm with big ambitions. For an in-depth interview with the firms
senior team, turn to page 28.
The firm held final closes for two funds this year, Golub Capital
Partners VIII (on $1.7 billion), and Golub Capital Partners International VIII (on $1.2 billion).
Its been a busy 12 months for the firm, which has closed a string
10
Golub Capital