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BlueBay’s Private Debt business to become independent

BlueBay’s Private Debt business is to become independent from BlueBay Asset Management. 

The move comes following the continued growth of the Private Debt business, from a small part of the BlueBay global leveraged finance business to a EUR13 billion AUM largely stand-alone business within the company.

As two distinct businesses, BlueBay and the Private Debt business believe the move is the best way to serve our clients and support the future growth of both businesses. BlueBay is fully supportive of the Private Debt business, to ensure it is in the best possible position to succeed as a standalone business.

BlueBay will continue to add new strategies and capabilities in liquid and illiquid fixed income, which complement its existing emerging and developed markets businesses, and reinforce its position as a firm at the convergence point between traditional and alternative asset managers.

Following the change, the Private Debt business will become independently owned and managed by the existing Private Debt management team and all persons directly involved in the business at BlueBay will be transferred to the new company at closing. 

The new stand-alone business will also receive investment from Dyal Capital Partners, an almost USD20 billion AUM private equity manager. Dyal Capital Partners will hold a minority, passive equity interest in the business, with the Private Debt management team holding the majority of the equity. 
Subject to obtaining certain regulatory and other approvals, the transaction is anticipated to complete in Q3 2019. Prior to completion, the Private Debt business will continue to operate as part of BlueBay and, following completion, there will be a transition period to ensure a smooth handover of any remaining shared functions between BlueBay and the Private Debt business. 

Commenting on the change, Erich Gerth (pictured), CEO of BlueBay Asset Management, says: “We are confident that this change will place both businesses in the best position to meet our clients’ long-term investment objectives and needs as fixed income markets continue to evolve rapidly. 

The Private Debt business has been a great success for BlueBay, but we feel that this change will not only allow the Private Debt business to continue to grow and prosper but enable BlueBay to focus future investment on its current strategies and new businesses with greater direct synergies. We support the Private Debt business becoming independent and we wish it every success in the future.”

Anthony Fobel, Managing Partner of BlueBay’s Private Debt Group, says: “We are excited about the Private Debt business becoming a standalone, employee owned and managed business, with the support of Dyal Capital Partners, a leading investor in alternative asset managers. We believe that the move to independence represents a natural evolution of our business as it has grown to be a market leading private debt business in Europe. 

“We have always operated independently within BlueBay from an investment perspective and all investment and related non-investment staff will be moving to the new business, ensuring continuity for our portfolio companies, investors, private equity partners and advisers. We believe that independence should allow us to continue growing our business to meet the exciting opportunities for private debt in Europe.”

The terms of the transaction have not been disclosed.

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