Barclays PLC BCS makes a push into the private credit market. The firm, along with AGL Credit Management, a premier investment manager specializing on corporate credit strategies, announced a cooperation agreement and the launch of a private credit investment platform, AGL Private Credit (AGL PC).
AGL PC has received an anchor commitment from a wholly-owned subsidiary of the Abu Dhabi Investment Authority (“ADIA”).
The platform combines AGL’s established credit capability with proprietary access to Barclays’ leading leveraged finance and investment banking origination capabilities.
AGL PC is expected to focus on directly originated senior secured loans to large corporate borrowers. It will seek to capitalize on an attractive and growing opportunity at the convergence of the private credit, broadly syndicated loan and high yield bond markets.
AGL Private Credit will operate as an independent manager, with complete control over origination, asset selection, portfolio construction and management, while having exclusive access to Barclays’ deal flow, as well as the ability to originate transactions directly.
AGL’s founder, CEO and CIO, Peter Gleysteen, stated, “We have the remarkable opportunity to combine our firm’s deep capabilities in corporate credit investing with access to Barclays’ strong origination, sector and advisory expertise to form a leading private credit platform. As the traditional leveraged finance and private credit markets continue to evolve, this is a synergistic extension of our market-leading specialized investment business.”
Gleysteen added, “We are pleased to collaborate with Barclays to offer its clients the private credit benefits of certainty, speed and long-term investment alignment and separately for AGL to provide a private credit opportunity to our investor universe.”
Taylor Wright, the co-head of investment banking at BCS, said, “This is the next step in building out Barclays’ private credit capabilities to complement the top-tier capability of our existing Leveraged Finance platform, which continues to evolve and respond to market dynamics. Across our client base, there is a strong desire to work with a single partner who can deliver the full range of financing solutions to meet their strategic objectives and AGL’s strong investment capabilities and track record make them an ideal collaborator for us in this venture.”
Hamad Shahwan Al Dhaheri, the executive director of the Private Equities Department at ADIA, said, “ADIA has been an investor in AGL since it launched in 2019, and this anchor commitment to AGL PC will support the next phase of the Company’s growth. We see strong investing synergies from the combination of AGL and Barclays’ expertise, creating a differentiated private credit platform that aims to address a clear market opportunity.”
Over the past year, BCS shares on the NYSE have gained 30.4% compared with the industry’s 19.8% growth.
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Currently, the company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Competitive Landscape
A number of financial institutions, including Goldman Sachs GS and JPMorgan JPM, have been making efforts to enter into the $1.7 trillion global private credit market, given attractive opportunities and high demand in the space.
In February 2024, GS entered into a partnership with Mubadala Investment, an Abu Dhabi sovereign wealth fund to invest $1 billion in private credit deals in multiple Asia-Pacific markets with a particular focus on India.
The expansion into the private credit space will likely drive Goldman’s revenue growth amid efforts to scale back its consumer banking business and focus on its core strengths of investment banking, trading and asset management.
Likewise, JPM has allocated $10 billion for its private credit strategy. The financial giant wants to bring together a group of lenders for the purpose of funding the private credit deals it originates.
JPMorgan held discussions with sovereign wealth funds, pension funds, endowments and alternative asset managers.
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