BNY Mellon’s credit arm, Alcentra, has raised $265 million for a fund seeking to give retail investors exposure to institutional private debt strategies.
The firm announced that its BNY Mellon Alcentra Global Multi-Strategy Credit Fund had closed on 30 August after successfully pricing its initial public offering of 2,652,001 shares at $100 per share.
The fund will not be publicly traded and has a limited lifespan of six years, subject to a one-year extension. It will aim to provide a total return of both high income and capital appreciation.
Alcentra’s strategy will be to invest at least 80 percent of its managed assets in credit instruments and in other investments with similar characteristics. Investments may include first- and second-lien senior secured loans; senior unsecured, mezzanine and other collateralised and uncollateralised subordinated loans; unitranche loans; corporate debt obligations other than loans; and structured products. It will invest in both the US and Europe and said a substantial portion of its assets would be in sub-investment grade credit.
Andy Provencher, head of North America distribution at BNY Mellon Investment Management, said: “It’s a challenging time right now in the markets for investors with a slowing global economy and a low interest rate environment, with investors on the lookout for yield.
“[The fund] seeks to provide investors with access to credit strategies typically available to institutions and the potential for increased yield, and Alcentra is a leading global manager in debt markets recognised for its expertise managing a global credit platform.”