The Public Sector Pension Investment Board, one of Canada’s largest pension funds, has committed €500 million to AlbaCore’s recently established European credit platform.
PDI previously reported that the investment was expected to amount to €1 billion. In a statement issued by PSP Investments, the fund said it “may deploy further capital” – hinting at a potential increase of its allocation in the future. A representative from AlbaCore declined to comment.
The investment amounts to one of the largest investments by the Canadian pension fund and is part of its push into private debt initiated 12 months ago. It is aiming to allocate C$5 billion ($3.7 billion; €3.4 billion;) to the asset class globally and has so far invested in 20 transactions, totalling C$2.4 billion, in North America alone.
Oliver Duff was hired in September as part of the firm’s strategy to increase its exposure to the European credit market.
“PSP Investments sees great opportunity in the European credit market and, as such, entered the market earlier this year with the hiring of Duff to lead our European private debt activities, which focus on sponsor-financed acquisitions, first liens, second liens and other debt instruments across the capital structure,” said David Scudellari, head of principal debt and credit investments at PSP.
The commitment serves as a seed investment for AlbaCore’s first fund, which held its first close following the commitment. The platform was created by David Allen earlier this year following his departure from the Canada Pension Plan Investment Board.
In September, Allen’s former colleague at CPPIB, Bill Ammons, joined the firm as a partner. His arrival followed the appointment of David O’Neill as business operations and risk manager from KGC Holdings in July.
According to market sources, the firm is in talks with a number of LPs and a second close on the fund is expected in the first half of 2017.