Churchill’s Schwimmer: Firm’s investing ‘conservative’

The New York-based mid-market lender also approaches deals as “collaborators”.

Churchill Asset Management has taken a more conservative investment approach in recent months, Randy Schwimmer, the firm’s head of origination and capital markets, told Private Debt Investor at a Roundtable earlier this year.

Schwimmer said the new tack is informed by the firm’s assessment of the current economic environment.

“In terms of our view of both portfolio management and underwriting,” he said, “we tend to take the view that we’re probably closer to the end of the cycle, and therefore we’ve been conservative about the types of industries we’ve focused on relative to their cyclicality.”

He cited auto, real estate and energy as three areas of business Churchill avoids.

Instead, the firm, which invests in senior debt in sponsored transactions, sticks to ‘defensive’ sectors, citing business services, healthcare and tech-enabled software as examples.

“We take the view we are going to treat all of our investments as if they are going to be subject to a cycle,” he said. “And that way, when it does happen, we are fully prepared and best positioned to create the best asset management that we can for ourselves and especially for our investors.”

Schwimmer also told PDI that Churchill takes a collegial rather than combative approach to deals. He said the firm has relationships that stretch back “decades” with other mid-market lenders.

“We don’t really have competitors. One of the beautiful things about our strategy is we are more collaborators than competitors,” he said. “We work well with the other lenders. The way I like to think about it is we are the path of least resistance for those lenders and their sponsors.”