Tuesday, January 31, 2023

AustralianSuper has $9bn private credit plans



AustralianSuper, the country’s largest pension fund, has teamed up with Nuveen unit Churchill Asset Management to boost its private credit presence.

The $175bn pension pool has $4.5bn in the strategy but wants to triple this, meaning a further notice $9bn could flow into private credit in the coming years.

It is starting with a $250m allocation to Churchill, “intended to grow substantially over time.”

AustralianSuper will invest in traditional senior and unitranche loans to private equity-backed US middle market companies.

Its plan to rapidly expand its private credit presence rests on direct lending by its in-house team and partnerships with third parties such as Churchill.

“AustralianSuper is looking to work selectively with managers that can demonstrate disciplined performance across market cycles as we expand the US private credit portfolio,” said head of private credit, Nick Ward.

“We believe the opportunity in US middle market senior lending continues to be very attractive, particularly given the floating rate nature of the investments, strong current income potential, significant lender protections and senior position in the capital structure,” said Ken Kencel, president and CEO of Churchill.

Nuveen, which oversees $1.1trn and is itself owned by insurance giant TIAA, announced in October it had bought London-based private debt manager Arcmont Asset Management.

Arcmont and Churchill will combine to form Nuveen Private Capital.


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