Principal® expands direct lending business in 2021 with an eightfold increase in committed capital
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DES MOINES, Iowa–(BUSINESS WIRE)–
Top Global Investors®, through its direct lending business, Principal Alternative Credit, closed 2021 with a more than eight-fold increase in committed capital, advancing its plans to expand its private debt capabilities. Marking the completion of its first full year in the direct lending market, Principal Alternative Credit closed nearly 40 deals, including five deals as principal agent, representing over $750 million in committed capital.
Principal Alternative Credit invests in privately negotiated debt transactions with backed and non-sponsored middle market companies across North America that typically have $5 million or more in EBITDA. The direct lending team targets deals of $25-200 million, with a typical hold size of $10-50 million.
Transactions in 2021 included opportunities across the full range of products offered by major alternative credit offerings, including senior debt, unitranche, mezzanine and PIK holdco, as well as equity investments supporting both sponsors and non- -sponsors, leveraged buyouts, additional acquisition financing, debt refinancing and recapitalization.
“Our partnerships with a growing group of private equity sponsors over the past year and a half demonstrate the range of solutions we can provide our clients as they grow their businesses,” said Tim Warrick, Managing Director , Principal Alternative Credit. “We look forward to 2022 and the opportunity to expand this capacity as we plan to issue $1.5 billion in commitments, add strategic hires in our sponsor and non-sponsor coverage areas and expand our fundraising efforts.”
Principal Global Investors has expanded its relationships and direct lending capabilities since July 2020, accelerating asset deployment. Building on the company’s 50 years of private lending experience1, Principal Alternative Credit seeks to provide its clients with financing options tailored to their capital needs.
“This past year has been a great example of our team’s ability to maintain a flexible and agile approach, balanced with an appropriate appetite for credit. We saw a significant increase in opportunities in the fourth quarter and were able to win deals and resolve funding issues for new and existing relationships,” said Matt Darrah, Managing Director and Head of Underwriting, Principal Alternative Credit.
About Principal Global Investors®
Principal Global Investors® leads global asset management at Principal®. As a multi-investment firm, we bring a focused perspective and offer expertise across a multitude of asset classes.
At our core, we are driven by our goal of helping investors and businesses achieve their financial goals. Our global investment professionals provide investment solutions for public and private pension funds, foundations and endowments, central banks, insurance companies, sub-advisory arrangements, sovereign wealth funds and individual portfolios.
Principal Global Investors manages approximately $577.4 billion in assets on behalf of over 800 institutional clients located in more than 80 markets as well as pension plans and individual clients, reflecting our reach and experience in the global market and our commitment to high quality research and service (as of September 30, 2021). To find out more, visit principalglobal.com.
The recent transactions described above are intended to demonstrate the application of Principal Alternative Credit’s investment strategy and represent intermediary marketing loan transactions previously entered into by Principal Alternative Credit. There is no guarantee that future transactions entered will have the same characteristics as the transactions described above.
© 2022 Principal Financial Services, Inc. Principal®, Principal Financial Group® and Principal and the logo are registered trademarks of Principal Financial Services, Inc., a Principal Financial Group company, in the United States and are trademarks and of Principal Financial Services, Inc., in various countries around the world.
1 Experience includes the investment management activities of predecessor companies, beginning with the investment department of Principal Life Insurance Company.
Shawn Finlen, 515-878-0507, [email protected]
Source: Leading Global Investors