Silver Rock Capital Partners (SRCP), an investment firm founded by alumni of Michael Milken’s family office, has raised more than $4bn for its latest credit fund, its largest to date, as stress builds across parts of the private capital markets, according to a report by the Financial Times.
The firm, which opened to external investors in 2016, has attracted commitments from endowments, sovereign wealth funds and family offices for a strategy focused on lending to companies facing financial strain and constrained refinancing options.
Led by Vinay Kumar, formerly of Goldman Sachs, SRCP is positioning itself to benefit from rising distress in private equity-backed companies amid higher interest rates and slower economic growth. The firm currently manages just over $7bn in assets, according to figures as of December.
The fundraising comes amid a broader trend of large-scale credit strategies being launched by alternative asset managers seeking to capitalise on tightening financing conditions across leveraged companies. Investors including Ares Management and Blackstone have also been active in deploying capital into stressed and transitional credit opportunities.
Kumar said the low-rate environment that fuelled aggressive leverage and dividend recapitalisations in previous years has largely ended, reshaping the private equity financing landscape.
The private equity sector has faced increasing pressure as higher borrowing costs strain portfolio companies and, in some cases, force restructurings or ownership transfers to creditors. Recent examples include restructuring discussions at Medallia and the takeover of Pluralsight by private credit lenders following losses for its sponsors.
The industry is also managing a growing backlog of unsold assets, estimated at around $4tn globally, which has further constrained exit activity and increased reliance on alternative liquidity solutions.
SRCP’s strategy will focus on larger-scale credit investments, typically deploying between $100m and $250m per transaction, across both private financings and asset-backed lending opportunities.
