UniSuper, a $115 billion super fund, has selected specialist private debt manager Revolution Asset Management to manage an Australian and New Zealand private debt portfolio.
Revolution, which has raised over $2.5 billion from institutional, family office and wholesale investors, said that its separately managed portfolio has been deploying capital into senior secured Australian and New Zealand private debt since it was established earlier this year.
The specialist investment manager noted that it seeks to provide stable income from senior secured loans with “the most compelling relative value” across corporate leveraged loans, private asset backed securities and real estate loans, excluding construction or development.
“I am delighted on behalf of the team at Revolution Asset Management to have been appointed by a super fund that has a long and proud history of managing the retirement savings for generations of Australians,” commented Revolution chief investment officer Bob Sahota.
“Private debt has been an important component of institutional and wealth portfolios, and in the current uncertain environment, can help to further diversify risk and deliver stable income. We look forward to a long and mutually beneficial relationship that will grow over the coming years.”
The firm explained that its focus has been on lending to companies that occupy market-leading positions, with attributes including high barriers to entry and transparent cash flows which sustain through the market cycle in leveraged buyout senior secured lending.
In the area of asset backed securities, Revolution said it has focused on established non-bank lenders which have scale and access to both debt and equity capital if required. The pools of loans that the firm lends against are focused on prime borrowers with high credit scores.
In real estate lending, Revolution stated that it seeks to fund established and stabilised properties in the office, retail and industrial sectors with quality tenant cash flow, assessed for debt serviceability, and repayment rather than relying on a forward view of valuations.
According to Revolution, its Australian and New Zealand private debt portfolio was yielding a 9.6 per cent gross return as of the end of March, above the stated target of the strategy.
