Capital Group and KKR have received regulatory clearance from the US Securities and Exchange Commission (SEC) to launch two co-branded credit funds, marking a significant milestone in their strategic partnership aimed at expanding access to private credit among retail investors, according to a report by Bloomberg.
The newly approved vehicles – Capital Group KKR Core Plus+ and Capital Group KKR Multi-Sector+ – represent the first offerings from the alliance, which was formed last year to leverage Capital Group’s expertise in public markets alongside KKR’s capabilities in private credit and alternative investments.
Both funds will target a 60/40 split between publicly traded debt and private credit assets, including direct lending and asset-backed strategies. Structured as 40 Act interval funds, they will offer quarterly liquidity of up to 10% of net asset value and provide daily pricing, catering to the growing appetite among high-net-worth individuals and financial advisers for hybrid fixed-income exposures.
Minimum investments for the new funds are set at $1,000, with management fees as low as 84 basis points for the Core Plus+ fund and 89 basis points for the Multi-Sector+ product, as per recent filings. Notably, neither fund will employ leverage nor charge performance fees.
This initiative is part of a broader industry trend, as alternative asset managers and traditional investment firms accelerate efforts to reach individual investors – a demographic increasingly viewed as the next growth frontier. The move also reflects a shift among private equity giants looking to diversify beyond institutional capital, amid signs of limited liquidity among large allocators.
Similar collaborations across the industry include BlackRock’s partnership with Partners Group, Blackstone’s tie-ups with Vanguard and Wellington Management, and Apollo’s alliance with State Street.
Capital Group and KKR are seeding the new credit strategies and will co-manage the funds. The firms have indicated plans to expand their product suite over time to include offerings across private equity, real estate, and infrastructure, all with an eye toward model portfolios tailored to the needs of financial intermediaries and wealth management platforms.
