Private debt breaks fundraising record

The asset class saw more than $180bn raised globally last year, although the number of fund closings was relatively small.

A notable increase in private debt fundraising last year saw the asset class move easily past the previous annual record with $180.1 billion collected by fund managers around the world, according to the latest PDI data.

The previous yearly high was in 2015, when $140.4 billion was raised. The $40 billion uptick last year was notable, since between 2013 and 2016 the total raised yearly was within a range of approximately $18 billion across the whole four-year period.

One caveat to last year’s spectacular outcome is that the total includes Apollo Global Management’s $24.7 billion Fund IX, only around 20-25 percent of which is expected to be invested in debt.

Other large funds to have announced closings last year included Lone Star Funds’ Fund X on $5.6 billion; Intermediate Capital Group’s ICG Senior Debt Partners Fund III on €5.2 billion; Ares Management’s Ares Private Credit Solutions on $3.4 billion; and Glendon Capital Management’s Glendon Opportunities Fund II on $2.5 billion.

The latest figures show the emergence of an elite of fund managers able to raise increasingly large vehicles – a theme detected in our recent PDI 50 survey. Indeed, despite the record-breaking total figure, the number of funds achieving closes last year (163) dipped to its lowest level since 2012. The record number of fund closes was 225 in 2015.

We will be bringing you further information and analysis as soon as we have a more granular breakdown of the figures, including emerging trends based around sector and geography.