The Pengana Diversified Private Credit Fund has now been launched, the firm’s first diversified global private credit investment fund for Australian wholesale and sophisticated investors.
Pengana said the new fund represented a “significant early step” towards providing a broader offering, with several additional offerings for retail investors now on the horizon.
The launch follows a joint venture announced between Pengana and its major shareholder Washington H. Soul Pattinson (WHSP) earlier this year. In a statement on Tuesday, Pengana confirmed that WHSP’s $200 million of seed funding is now fully committed.
“This was an important piece in solving the challenges of bringing a truly diversified global private credit offering to market”, said Pengana Capital Group chief executive officer Russel Pillemer.
“In order to offer our investors a truly global private credit return experience from day one, this initial investment allowed us to build out the foundations of a portfolio that we can bring to market.”
According to Nehemiah Richardson, the CEO of Pengana’s recently launched private credit division Pengana Credit, the new fund will provide access to quality private credit vehicles that are typically difficult for non-institutional investors in Australia to access.
“Access to global private credit is a huge issue for Australian investors, both wholesale and retail, who face significant obstacles to invest,” he said.
“We are pleased to bring a solution to market that unlocks the opportunity for wholesale investors and are excited about launching some compelling retail offerings in the near future.”
The Pengana Diversified Private Credit Fund will target a total net return equivalent to the Reserve Bank of Australia (RBA) cash rate plus 8 per cent.
The firm explained that investors must commit to a minimum three-year lock-up period, during which they will receive annual distributions. The private credit portfolio is described as highly diversified and designed to deliver low volatility along with attractive risk-adjusted returns.
“Risk is spread across an actively managed multi-manager, multi-asset portfolio. Portfolio construction is key to ensuring low correlation across investments and high risk-adjusted returns,” Mr Richardson said.
Mr Richardson also highlighted the strong growth in global private credit over the past 15 years.
“Private credit has grown rapidly as global banks have retreated from corporate lending due to increasingly stringent regulatory requirements, providing one of the most compelling risk/return investments,” he stated.
Pengana noted that it has worked closely with Mercer, which was appointed to act as investment adviser on the portfolio construction for Pengana Credit back in July, to secure capacity with highly sought after global private credit opportunities.
The diversified funds management group said that its new fund has already opened to investors on its waiting list, with broader availability expected in the coming weeks.
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.