“Increasing allocations will come down to cash flows,” according to Bain & Co. in its recent Global Private Equity Report 2024. The practical impact of net cash flow position for buyout fund investors, reflected in DPI, will be a primary driver of fundraising in 2024.
CalPERS will be upping its private market allocation to 40% of plan assets, after a board decision on March 18. PE will increase to 17% from 13 and private debt to 8% from 5% of plan assets.
Blackstone’s purchase of $1.1 billion in credit card receivables from Barclays and KKR’s acquisition of a $7.2 billion RV loan portfolio from Bank of Montreal illustrate a trend of private credit expansion into asset-backed finance. Continued balance sheet pressure at banks suggests more such transactions may be coming.
Texas Permanent School Fund announced that it will replace BlackRock as manager on $8.5 billion of investments.
On February 7 2024, the European Union adopted a final text amending the AIFMD and UCITS directives (AIFMD II). In a recent Client & Friends Memo authored by Michael Newell and Alix Prentice, we focus on loan origination funds and the novel rules applying to them in terms of scope, leverage requirements and liquidity management requirements, as well as important considerations for the grandfathering period as these entirely new rules come into force locally across Europe.
The Fund Finance Series Webinar held on February 15th organised by the Luxembourg law firm Praxio Law & Tax and hosted by Michael Mbayi on the topic “2024 Market Perspectives” is now available and includes insights from Cadwalader's own, Michael Hubbard!
With the increasing complexity of fund structures and the growing prevalence of US Pension Funds in the European market, we have seen an uptick in the number of queries particularly from European banks and funds around how to structure their security packages in circumstances where direct security is not possible from one or more feeder funds.