PAG closes fifth credit fund on $2.6bn
PAG has closed its fifth pan-Asian private credit fund at the hard cap with USD 2.6bn. It is said to be the largest direct lending fund raised in the region to date.
PAG Loan Fund V received commitments from more than 20 LPs across North America, Europe, the Middle East, and Asia Pacific. These include sovereign wealth funds, pension funds, and endowments.
PAG’s preceding vintage in this strategy closed on USD 1.5bn in 2020 with support from the likes of San Francisco Employees’ Retirement System. Loan Fund III closed on USD 950m in 2018; USD 800m was raised for Loan Fund II four years earlier.
PAG claims to be the largest private debt investor in Asia Pacific by net committed capital with capacity to provide financing from as little as three months to up to seven years. The team is led by Eddie Hui, previously of The Blackstone Group, and Anshumann Woodhull, previously of Deutsche Bank.
The Fund V close extends a streak of fundraising activity in Asia's private credit space. There is evidence of renewed LP appetite for the asset class as well as discrete Asia-specific opportunities in the small to medium-sized enterprise (SME) sector.
GPs launching Asia credit strategies in the past 12 months include Navis Capital Partners and China's Primavera Capital Group. The former plans to launch a fund, while the latter is already in the market seeking USD 300m. Hong Kong-based VI Asset Management wants to raise USD 150m, having recruited a team from EmgeVest in July to lead the effort.
KKR, which raised USD 1.1bn for its debut Asia credit fund in May, later partnered Abu Dhabi’s Mubadala Investment with a view to mobilising another USD 1bn. Among the other global GPs active in the space in Asia, both The Carlyle Group and Blackstone have made efforts to broaden their coverage and expand their teams.
In October, Baring Private Equity Asia’s (BPEA) credit unit raised USD 475m for its third fund and also spun out as an independent entity. This coincided with BPEA's merger with EQT, which is no longer active in private debt.
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