PAG closes Loan Fund IV at $1.5bn – exclusive

The firm now manages $40bn, of which $15bn is in private debt and liquid strategies.

PAG, the Asia-focused alternative investment firm, held a final close on its latest private debt fund in early June, an industry source has confirmed to Private Debt Investor. PAG Loan Fund IV, the firm’s fourth direct lending fund, closed at a hard-cap of $1.5 billion.

The fund is part of PAG’s private debt strategy, which aims to provide tailored financing solutions to corporates across the Asia-Pacific region. Its financing types include asset-backed loans, mezzanine loans and mortgages, with terms range from three months to seven years, according to the firm’s disclosures.

PAG’s investor roster includes San Francisco Employees’ Retirement System. As PDI reported in November 2019, SFERS committed $100 million to PAG Loan Fund IV on 14 October. Previously, the pension disclosed its $50 million commitment to PAG Loan Fund III. PAG held a final close for PAG Asia Loan Fund III at a hard-cap of $950 million in May 2018.

Another US pension fund, Florida Retirement System Trust Fund, also committed $150 million to the forth loan fund, PDI data show.

It is understood the firm held a final close for PAG Special Situations Fund III, at $1 billion in November 2019. The PAG Special Situations series looks to provide liquidity solutions and participate in debt restructurings, as well as non-performing loan acquisitions.

Both PAG Asia Loan Fund IV and Special Situations Fund III fall under PAG’s Absolute Returns strategies. These strategies include private debt and liquid investments and are overseen by Chris Gradel, PAG’s chief investment officer and co-founder.

PAG also invests in private equity and real estate private equity strategies.

Last week, PAG made an equity investment of about $300 million in India’s Edelweiss Wealth Management, the wealth management business of Mumbai-headquartered Edelweiss Group, according to a statement from Edelweiss on 27 August.

It is understood that PAG’s equity investment was a private equity transaction funded out of PAG Asia III, the latest buyout fund in the group’s private equity strategy, which closed at $6.1 billion in November 2018. The official deal closure is subject to regulatory approvals.

It was confirmed to PDI that the transaction aims to fund the balance sheet capital of Edelweiss’ wealth management business only. Edelweiss Group consists of six business units: corporate credit, retail credit, wealth management, asset management, life insurance and general insurance.

PAG managed $40 billion in assets under management as of end-June, of which $15 billion was in the absolute return strategies. The firm works with more than 150 institutional investors from Europe, North America, Asia and the Middle East.