TOL - 8th Nov, 2024
A unique opportunity in private markets
In this Fund in Focus, Kelli Marti from Churchill Asset Management by Nuveen outlines the opportunity available in private credit today.
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Note: This interview was recorded on 8 October 2024. You can watch the video or read an edited summary below.
Churchill Asset Management is a $50 billion asset manager, focused on middle-market opportunities in the US. They have their eyes on sponsor-backed businesses - and provide debt across all aspects of the capital structure.
This includes senior secured floating rate debt, junior capital investments, second lien debt, and equity co-investments, depending on the sponsor's preferences for Churchill's participation.
This scale is important in an increasingly competitive environment, with Churchill's Senior Managing Director and Portfolio Investment Strategist, Kelli Marti, arguing that strong relationships with private equity sponsors are the key to accessing deals - particularly as deal flow is starting to pick up.
"Over the last couple of years, M&A activity has been down and the real reason for that is just a delta between the valuation expectation of a selling sponsor and a buying sponsor. The reason they haven't been able to agree on the ultimate valuation of a business is due to the high cost of capital given where interest rates have been," Marti explains.
"With interest rates coming down, we're seeing that delta between the bid-ask of these businesses starts to shrink, and as a result, we're seeing an uptick in M&A activity, which is a very positive change for the market."
In this Fund in Focus interview, Marti explains what makes a good private credit deal, some of the red flags the team looks out for, and how investors can properly assess a private credit manager when deciding whether or not to invest.
Timecodes
- 0:00 - Intro
- 0:21 - What makes Churchill unique
- 0:57 - Tactical allocation strategy
- 1:23 - Advantage in accessing deals
- 2:08 - Deal flow revival on the horizon
- 2:53 - What makes a good private credit deal
- 4:06 - What are some red flags when assessing deals
- 5:04 - Risks investors should be aware of
- 6:06 - Key elements of the strategy
- 6:34 - How you can access this opportunity
Learn more about the Nuveen Churchill Private Credit Income Fund here.
Managed Fund
Nuveen Churchill Private Credit Income Fund
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Ally Selby is the deputy managing editor at Livewire Markets, joining the team at the end of 2020. She loves all things investing, financial literacy and content creation, having previously worked for the likes of Financial Standard, Pedestrian Group, Your Money, Sky Business and Sky News.
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Channel Investment Management Limited (ACN 163 234 240; AFSL 439007) (“CIML”) is the responsible entity and issuer of units in the Nuveen Churchill Private Credit Income Fund (ARSN 678 164 335).
Neither (i) Nuveen Australia Limited (ACN 168 690 444; AFSL 460770) (“NAL”), nor (ii) Churchill PCIF Advisor LLC, Churchill Asset Management LLC or Nuveen Asset Management, LLC is the responsible entity or the issuer of units in the Fund. NAL is regulated by the Australian Securities and Investments Commission and holds an Australian Financial Services Licence in respect of financial services provided in Australia to wholesale clients as defined in section 761G of the Corporations Act 2001 (Cth).
The information contained in this material is general information only and is intended solely for licensed financial advisers or authorised representatives of licensed financial advisers and wholesale clients. It is not intended to constitute financial product advice or an offer, invitation, solicitation or recommendation to invest, sell or hold a security or an investment strategy. The information is not intended to be relied upon as a forecast, research, investment advice or a recommendation. The information is not provided in fiduciary capacity and does not take into account the specific objectives, financial situation, needs or circumstances of any particular investor, or suggest any specific course of action. The information is not provided in fiduciary capacity and does not take into account the specific objectives, financial situation, needs or circumstances of any particular investor, or suggest any specific course of action. Investors should consider, with a financial adviser, whether the information is appropriate in light of their specific circumstances. Financial professionals should independently evaluate the risks associated with products or services and exercise independent judgment with respect to their clients.
Before making any investment decisions you should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the Fund available from https://www.nuveen.com. Neither CIML or NAL guarantees the performance of the Fund or the return of an investor’s capital.
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Ally Selby is the deputy managing editor at Livewire Markets, joining the team at the end of 2020. She loves all things investing, financial literacy and content creation, having previously worked for the likes of Financial Standard, Pedestrian...
Expertise
Ally Selby is the deputy managing editor at Livewire Markets, joining the team at the end of 2020. She loves all things investing, financial literacy and content creation, having previously worked for the likes of Financial Standard, Pedestrian...
Expertise
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