Loan Note: EnTrust’s new $2bn maritime fund; Kartesia launches partnership

The $2bn-plus maritime fund making waves. Plus, Kartesia sells a minority stake and the European Leveraged Finance Association singles out private debt. Here's today's brief for our valued subscribers only.

They said it

“The pandemic has expedited significant changes in pre-existing trends, some of which we believe may recede somewhat as the public health threat diminishes due to factors such as mass vaccinations. But we think that others, such as online retailing and sustainability, are here to stay. It pays to be aware of these and invest accordingly”

Deb Clarke, global head of investment research at Mercer, on a new study from the firm, The great acceleration: themes and opportunities 2021

First look

Fundraising is plain sailing for EnTrust
Combining two hot trends in one has proved to be a winning formula for EnTrust Global, the New York-based asset manager, which has closed fundraising for an ESG-focused maritime fund on $2.1 billion.

The EnTrust Global Blue Ocean Fund, which has raised $925 million of its capital since the initial peak of the pandemic in April this year, will support vessel owners, operators and other maritime businesses in making themselves more sustainable and environmentally friendly. The fund is part of EnTrust Global’s private debt and real assets division and appeals to investors’ appetite for both sustainable investing and speciality finance.

The strategy is led by managing directors Julian Proctor and Svein Engh. “Vessel owners and their customers and end-users are increasingly focused on the impact of the shipping industry on the environment, and especially on carbon emissions,” said Proctor. “But there is inadequate financing for the industry to move to cleaner, more advanced technology.” He added that the fund would help the shipping industry transition to a more sustainable future.

Kartesia latest to team up
It’s hard, if not impossible, to work out what 2021 has in store. Yet the latter part of 2020 has shown firms keen to undertake partnerships and strategic initiatives of various stripes as they position themselves for the long term.

The latest example comes from pan-European manager Kartesia, which has sold a minority stake to asset manager Candriam and its affiliate New York Life Investments Alternatives (read more here). Kartesia says the deal will widen its distribution network and provide it with additional operating and financial resources to help it grow further.

Reports surfaced last week that US fund manager Owl Rock Capital Partners is understood to be considering a merger with Neuberger Berman‘s Dyal Capital Partners. There have also been several tie-ups between GPs and sovereign wealth funds, such as this one between Barings and Mubadala.

New voice for private debt 
We have it on good authority that the board of the European Leveraged Finance Association is about to add a private debt committee.

The trade body describes itself as “the voice of the investor community” in the leveraged finance market, campaigning on investors’ behalf for greater transparency and the establishment of best practices.

ELFA’s members tend to operate at the larger end of the market rather than in the private debt mainstream. Although some of the issues are the same, ELFA appears to have decided that private debt should have its own approach.

It is understood that the private debt committee will be chaired by Carina Spitzkopf, a director in private debt at Federated Hermes. We’ll bring you more on this when we have it.

Data snapshot

Stick with what you know. Most private debt fund managers are not making changes to the types of strategies they offer in response to covid-19. A survey by the Alternative Credit Council found 88 percent will continue to run their existing strategies while just 10 percent anticipate making changes for their next fundraise.

Essentials

Awards vote underway 
Voting is off to a flying start in our annual awards poll. Don’t forget to make your opinions count here.

Backing for UK asset-based financier
British Business Investments, a commercial subsidiary of the British Business Bank, has made a £25 million commitment to UK asset-based finance specialist, Haydock Finance.

The three-year funding commitment is structured as a block discounting facility and will help Haydock continue to grow its asset finance division, providing hire-purchase, leasing and refinance for business assets to smaller companies wanting to invest and grow.

Real estate embraces social benefit 
Research from Alpha Real Capital reveals that 80 percent of European professional investors now have social real estate firmly on their radar as an investment opportunity. Over the next two years around 30 percent expect pension funds and other institutional investors to increase their real estate allocation to funds offering a social benefit.

LP watch

Institution: South Carolina Retirement System
Headquarters: Columbia, US
AUM: $32.49bn
Allocation to alternatives: 28.0%

South Carolina Retirement System has confirmed $150 million in commitments to two private debt funds, according to minutes from its December investment committee meeting.

The commitments comprised $75 million each to Fortress Lending Fund II and Fortress COF V. Both funds are managed by Fortress Investment Group and will invest in North American markets.

The $32.49 billion US public pension has a 9 percent allocation to private debt. SCRS has made $825 million in commitments to private debt vehicles with 2019 and 2020 vintages.

Institution: Ohio Police & Fire Pension Fund
Headquarters: Columbus, US
AUM: $16.24bn
Allocation to alternatives: 31.19%

Ohio Police & Fire Pension Fund has agreed to commit $50 million to Raven Asset-Based Credit Fund II, a contact at the pension informed Private Debt Investor.

The $16.24 billion US public pension has a 5.0 percent target allocation to private debt that currently stands at 3.05 percent.

The pension fund’s recent commitments have been to vehicles focused on the corporate and real estate sectors in Europe and North America.


Today’s letter was prepared by Andy Thomson with John Bakie and Robin Blumenthal.

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