Launching in February 2018, the new investment manager aims to give “institutional and high-net-worth investors with access to Australia’s burgeoning secured private debt market”, with the goal of raising $500 million for the first fund and delivering annual returns of 4-5 per cent, a statement said.
The firm will be headed by Challenger’s former head of fixed income Bob Sahota, who has over two decades’ experience in private debt and managed Challenger’s life insurance portfolio worth $9.3 billion, alongside a number of institutional private debt mandates and accounts.
Commenting on the launch, Mr Sahota said he was delighted to launch Revolution, which he hoped would “revolutionis[e] the way superannuation funds and high-net-worth individuals think about their fixed income allocation”.
“Revolution will provide investors unique access to the Australian private debt market, which will deliver a higher risk adjusted return for investors and at the same time provide corporates, sponsors and specialty finance with much needed debt capital alongside traditional banks,” Mr Sahota said.
Mr Sahota will launch the fund in partnership with multi-boutique funds management business Channel Capital.
Channel Capital head of distribution Andrew King called a specialist private debt manager a “prudent option for investors” given that a certain level of expertise is required to adequately assess lending risks.
“Bob’s track record speaks for itself in this respect and we’re delighted to partner with Bob to launch Revolution,” Mr King said.
Channel Capital will provide capital requirements, infrastructure, distribution and back office support to the new boutique.
Revolution is the sixth boutique fund manager owned by Channel Capital, which has $6 billion combined client funds under management.
