BlackRock raises £1.7bn for diversified debt offering

The vehicle was specially created to meet the needs of UK pension funds to diversify their private credit portfolios.

Asset manager BlackRock has held a final close of its Diversified Private Debt Fund with £1.7 billion.

The fund was designed specifically for UK pension schemes to address their needs for income and diversification across a variety of global private debt markets. BlackRock said the asset class continues to offer investors attractive returns and stable income, and can improve portfolio resilience during periods of increased market volatility and inflation.

DPD was developed in partnership with UK consultants, with Isio taking the lead, to provide a mix of private debt strategies in a single solution. It will invest across US and European direct lending, US and European real estate debt, as well as global opportunistic strategies. The fund will be managed by James Keenan, CIO and global head of credit at BlackRock.

The fund beat its initial £1 billion target and is already 60 percent invested with 164 investments to date and expects to be fully invested early in 2023. It is thought to have a seven-year lifespan with the capacity for two, one-year extensions.

Deals will be sourced in house using BlackRock’s wide geographical reach and leveraging its long-term strategic relationships.

Commenting on the fundraise, Keenan said: “We are seeing strong investor desire for income and interest in diversified allocations across the credit spectrum. This strategy optimises global exposure across private debt and real estate debt markets through a single strategy.”