Alternative asset manager Dawson Partners has completed a $1.2bn collateralised fund obligation (CFO), packaging interests in private capital funds into a multi-tranche securitisation, according to a report by Bloomberg citing sources familiar with the matter.
The transaction, which closed earlier this year, is the latest in a series of CFOs issued by the Toronto-based firm over the past 18 months. The structure comprised several rated debt tranches, assessed by Kroll Bond Rating Agency, alongside a junior equity or first-loss piece. Law firm Fried, Frank, Harris, Shriver & Jacobson is understood to have advised on the deal.
Dawson Partners declined to comment on the transaction. KBRA and Fried Frank did not respond to requests for comment.
CFOs use distributions and cash flows from underlying private equity and credit fund stakes to back debt securities. The format has gained momentum as fund sponsors and limited partners seek liquidity solutions amid muted exit activity and subdued M&A volumes.
Dawson Partners – formerly known as Whitehorse Liquidity Partners – focuses on delivering structured liquidity solutions to investors in private markets. As of year-end 2024, the firm reported over $20bn in assets under management.
Growing interest from US insurers has been a key tailwind for the CFO market, particularly after recent regulatory updates clarified capital requirements for these exposures.
With over $8tn in assets under management, insurers have steadily increased allocations to private markets, and CFOs offer a more capital-efficient route to access these assets relative to direct fund investments.
