Fund financing: Navigating volatility with a private market sub-line
A look at why subscription-line loans may be a game changer for some private market investors, and how they may offer higher yields and stable income without extra credit risk.
Private Credit
An asset class combining potential for yield and exposure to unique performance drivers.
A range of advantages
Private and alternative credit offer investors the potential for higher yield and lower risk, relative to similarly rated public bonds. Furthermore, exposure to economic drivers generally not available in the public credit markets can result in significant diversification benefits.
ESG is at the heart of our process
ESG is central to our investment capabilities. We look to deliver robust financial outcomes for our clients – as well as actively contributing to a fairer, more sustainable world. We focus on understanding the ESG risks and opportunities of our investments alongside other financial metrics to make better investment decisions and produce superior risk-adjusted returns for our clients.
Our capabilities
Aberdeen Investments offers clients access to the major areas of Europe private credit, including commercial real estate debt, infrastructure debt, corporate private debt and fund financing among other areas.
Fund Financing Fireside Chat
P&I 2023 Fixed Income & Credit Interview
Important information
Alternative investments involve specific risks that may be greater than those associated with traditional investments; are not suitable for all clients; and intended for experienced and sophisticated investors who meet specific suitability requirements and are willing to bear the high economic risks of the investment. Investments of this type may engage in speculative investment practices; carry additional risk of loss, including possibility of partial or total loss of invested capital, due to the nature and volatility of the underlying investments; and are generally considered to be illiquid due to restrictive repurchase procedures. These investments may also involve different regulatory and reporting requirements, complex tax structures, and delays in distributing important tax information.
Diversification does not ensure a profit or protect against a loss in a declining market.
What we offer our clients
Primary investments
Primary investments are those made in private equity funds during their initial capital-raising. A portfolio of primary fund investments, also known as a fund-of-funds, gives investors access to the expertise of multiple fund managers and a variety of companies through a single investment. Our long experience as a primary investor means our clients can benefit from the following:
- A rigorous, time-tested evaluation process
- Access to leading managers globally, providing exceptional choice of opportunities
- More than 25 years of relationship building, so we fully know our general partners and can be confident in our investment decisions
- A process with ESG interaction at its core
Secondary investments
Secondary investments involve the buying and selling of pre-existing investor commitments to private equity funds. We are well placed and active in the secondary market where our deep relationships, strong reputation and network of intermediaries give us a distinct advantage and allow us to offer our clients excellent access to this market.
Co-investments
Private equity co-investments, or direct investments, are investments made alongside another GP directly into companies. There are many benefits to co-investing, including the ability to gain exposure to what we believe are attractive investment opportunities whilst avoiding a layer of fees. Again, our strong, long-standing relationships with GPs, combined with our proven experience, mean we are leading players in this segment of the market.
Investment Trust
The investment objective is to achieve long-term total returns through holding a diversified portfolio of private equity funds and direct investments into private companies alongside private equity managers (“co-investments”), a majority of which will have a European focus.
Meet the team
Neil Odom-Haslett
Head of Private Credit
Neil joined the company in 2013 and has worked in the credit industry for more than 30 years. As Head of Private Credit, Neil is responsible for leading on all private credit activities across Aberdeen.
Neil started his career with NatWest and subsequently worked for a number of international banks, including Fortis, Eurohypo, RBS and Deutsche Pfandbrief Bank, where he was the only non-German domiciled person to be given the powers of a voting member of the credit committee.
Neil has extensive experience in both originating and restructuring private credit transactions in the UK and Europe. Neil is also the immediate past President of the Association of Property Lenders (the UK lending representative body) and has eleven years’ investment experience at Aberdeen, and over 30 years’ in the industry. Neil is also an associate at the Associate of the Institute of Bankers.
Martin Barnewell
Head of Commercial Real Estate Lending
Martin joined the company in 2014, bringing over 20 years of experience in commercial real estate and lending. Before this, he worked at Allied Irish Bank and later at Anglo Irish Bank, where he was responsible for the origination, underwriting and management of commercial real estate debt working in both the Dublin and Chicago offices. In 2012, Martin joined Capita Asset Services as Head of Client Relations, based in London, where he was responsible for the management of a portfolio of over £40billion of syndicated and securitised loans. He holds a Bachelor of Business and Law from University College Dublin.
Alex Campbell
Head of Infrastructure Debt
Alex is Head of Infrastructure Debt at Aberdeen, with overall responsibility for the team’s strategies in sourcing, underwriting and managing debt investments across a full range of infrastructure sectors. Aberdeen invests in both social and economic infrastructure across clean energy, transport, social infrastructure, utilities and digital assets. The team manages funds principally on behalf of insurance and pension institutions and invests both in developed and to a growing extent in emerging markets. Alex joined the company in 2015 after prior roles in the financial guarantee industry and in investment banking in London, with periods also spent in New York and Singapore. Alex has a MA degree in Classics from Oxford, where he studied civilisations with a strong track record in building infrastructure such as roads, bridges, aqueducts, sewage, concrete and arches, public buildings, urban planning, ports and lighthouses, and communications; as well as developing democratic principles, comprehensive legal systems, coinage and banking.
Shelley Morrison
Head of Fund Finance
Shelley Morrison leads the strategy for Fund Finance at Aberdeen. She has extensive experience in the origination, structuring and execution of fund level debt facilities across multiple asset classes. She has been with Aberdeen since 2019. Before joining Aberdeen, Shelley was a Director in the Fund Finance team at RBS for 6 years where she managed a portfolio of subscription loans, NAV loans and GP finance to global funds across Private Equity, Private Debt, Infrastructure and Real Estate. Prior to that, she worked in structured asset finance at RBS and Lloyds for 10 years, with a focus on commercial ship finance. Shelley holds the both the IMC and CISI certificate in Corporate Finance and the CFA Certificate in ESG Investing. Shelley sits on the Fund Finance Association EMEA Executive Committee and Women in Fund Finance Committee. Shelley received a first class MA (honours) degree in Geography and an MSc in Social and Political Theory, both from the University of Edinburgh.