HarbourVest Partners and CIFC Asset Management are forming a strategic relationship.
CIFC’s US senior debt capabilities will complement HarbourVest’s established capabilities and enable yield-oriented investment solutions.
"This strategic relationship with CIFC allows HarbourVest to continue to provide our clients with best of breed opportunities across the private markets including US senior secured corporate loans exclusively with CIFC," says Rob Wadsworth (pictured), managing director of HarbourVest. "With historically low interest rates expected to prevail for the foreseeable future, many institutional investors are interested in strategies that can provide higher current yields and the potential for strong returns over the long term."
This relationship is an extension of HarbourVest’s strategy in the private credit markets. The firm began investing into credit funds in 1995, has provided mezzanine loans to private companies since 2003, and has been active in the European senior loan market since 2010. An affiliate of HarbourVest serves as the investment manager for HarbourVest Senior Loans Europe. HarbourVest has been investing in private markets for over 30 years.
"We are excited to be teaming up with HarbourVest and see significant opportunity to jointly deliver investment solutions focused on private debt. This relationship will have great synergy between our complementary organizations, and many of the private companies within our portfolios are backed by the same general partners with whom HarbourVest has long-standing relationships," says Peter Gleysteen, chief executive officer of CIFC.
In connection with the transaction, HarbourVest is expected to become a minority shareholder of CIFC and to enter into a revenue-sharing arrangement with respect to the investment advisory fees generated by jointly-branded private debt programmes.
Wadsworth says: "Private debt strategies have many of the same qualities as private equity investing – i.e. reliance on similar networks and information for deal sourcing and evaluation, medium-term investment horizons, structuring for downside protection and the potential to outperform the public markets. CIFC’s focus on US senior secured corporate loans is a complement to our existing expertise across mezzanine debt, European senior loans, and private equity."
