Oak Hill closes CSF II on $2.2bn, beating target

The credit fund is more than twice the size of its predecessor.

Oak Hill Advisors announced it has closed its Credit Solutions Fund II with commitments of $2.2 billion, surpassing an original target of $2 billion. The closing figure includes a $500 million parallel vehicle with a similar strategy for a single pension fund client.

The investor group for CSF II is a mix of existing and new investors. In announcing the final close of CSF II, Oak Hill said specifically that the investors include sovereign wealth funds, insurance companies, endowments and foundations, family offices, high-net-worth individuals and pension funds, including CalPERS.

CSF II will pursue a strategy that a spokesperson for the firm calls “flexible across senior secured to junior financing solutions for larger corporate borrowers”.

Oak Hill launched CSF II in October 2021, and the fund began investing in January 2022. Since then, Oak Hill says, the fund has “deployed capital at a healthy pace, drawing over 25 percent of equity commitments and financing to make $1.1 [billion] in investments to-date”.

CSF II’s predecessor fund launched in May 2017 with a target size of $1 billion, according to PDI data, but falling short of that target at $850 million. This has now been more than doubled by the CSF II closing. A spokesperson declined to comment on the performance of CSF I.

Oak Hill Advisors had $57 billion of assets under management as of 31 December, 2022 across several strategies: distressed, special situations, liquid, structured credit and real assets.

Oak Hill is headquartered in New York, with offices in Fort Worth, London, Sydney, Hong Kong and Luxembourg. T Rowe Price acquired Oak Hill in the fourth quarter of 2021 in a move designed to accelerate the acquirer’s expansion into alternative investments. When announcing the acquisition that year, the acquirer specified that Oak Hill would retain its brand and autonomy over its investment decisions. PDI has named Oak Hill Responsible Investor of the Year.