Channel Capital’s West Street European Private Credit Fund (AUD) is an open-end Australian unit trust that accesses Goldman Sachs Asset Management’s European Private Credit strategy, which was introduced in offshore wealth markets in late 2023.
According to the asset manager, the fund aims to deliver risk-adjusted returns through exposure to directly originated senior secured debt with borrowers.
Moreover, its focus is on high-quality, mid-to-large cap companies with stable cash flows and leading market positions in recession-resilient industries such as healthcare and software.
Channel Capital noted that Goldman Sachs Asset Management’s private credit business is one of the world’s largest private credit platforms with over US$110 billion in assets across direct lending, mezzanine debt, hybrid capital, and asset-based lending strategies.
“We have been an active investor in European private credit since 1996 and continue to see the market as a source of returns for investors,” said James Reynolds, global head of direct lending at Goldman Sachs Asset Management.
“Australian investors are increasingly interested in private credit opportunities internationally and through this fund from Channel Capital, they will be able to access the direct lending markets in Europe for diversification.”
Describing European private credit as “far from being a niche asset class”, Luke Mandekic, co-head of distribution at Channel Capital, added that it offers exposure to a deep pool of leading global businesses.
“Many large European companies within the portfolio generate a significant portion of their revenues from outside Europe, adding to portfolio diversification. The European private credit market is rapidly growing, driven by the demand for alternative financing sources, creating a dynamic environment for investors,” Mandekic said.
“The West Street European Private Credit Fund (AUD) provides an attractive opportunity for Australian investors to access a diversified portfolio backed by Goldman Sachs Asset Management’s cycle-tested private credit platform, which leverages the extensive network and sourcing capabilities of Goldman Sachs.”
In an op-ed for InvestorDaily earlier this year, Pengana Credit chief executive and managing director Nahemiah Richardson said that private credit has not played the same role in replacing bank financing to large segments of the commercial lending market in Australia as it has with other global counterparts like Europe.
“It’s very different in North America and Europe, where private credit plays a significant and important role providing middle market borrowers and non-bank lenders with access to credit,” Richardson wrote at the time.
At the start of the year, an estimated 84 per cent of mid-market lending in the US and Europe was provided by private credit lenders, and 16 per cent by banks on a hold-to-maturity basis.
