There have been 33 acquisitions of different credit score managers in 2024, involving $267bn (£215bn) in acquired property underneath administration (AUM).
Gapstow’s 2024 annual assessment of such acquisitions revealed that direct lending companies accounted for 70 per cent of transactions and 88 per cent of acquired AUM final 12 months.
Twelve minority-ownership-stake purchases accounted for 18 per cent of acquired AUM, up dramatically from 2023.
Nevertheless, the was just one collateralised mortgage obligation (CLO) based mostly transaction, a class which often accounts for 15-20 per cent of exercise.
The biggest transaction was Blackrock’s $12bn acquisition of direct lender HPS, which accounted for half of acquired AUM alone.
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Different transactions of observe in 2024, included German asset supervisor Wendel’s acquisition of Chicago-based company lender Monroe Capital, Brookfield buying 51 per cent of asset-backed lender Castlelake, and Blue Owl buying each industrial actual property lender Prima Capital Advisors and Atalaya Capital.
Elsewhere, Janus Henderson acquired speciality finance lender Victory Park Capital and Third Level acquired AS Birch Grove, which has company credit score methods embody lending and CLOs.
Regardless of complete transaction quantity hitting a report in 2023, there have been solely 4 minority stake acquisitions that 12 months, accounting for $3bn in AUM.
Against this, 2024 introduced a resurgence in minority stake acquisitions, with twelve transactions for $48bn in acquired AUM.
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In line with information from Gapstow’s Various Credit score Acquisition Database, final 12 months’s acquired AUM quantity was near 2023’s record-breaking quantity of $285bn.
Aside from a dip through the 2020-2021 Covid period, 2024 continues a ten-year pattern of accelerating transaction volumes, which has a relentless annualised development charge of greater than 20 per cent since 2015. This development charge is stronger than that of the broader funding administration business.
Wanting forward, Gapstow expects elevated transaction exercise to proceed. “Progress in demand for various credit score remains to be robust in absolute phrases and relative to different asset lessons. Each conventional and various funding managers consider that gaining and/or constructing publicity here’s a strategic crucial,” the report mentioned.
It additionally anticipates an increase in acquisitions of companies which presently have minority house owners and fewer bigger “mergers of equals”.
“Companies trying to develop previous $50bn in various credit score AUM and in the end towards the $100bn mark, could take into account a bigger scale merger relatively than a number of smaller acquisitions,” it added
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