The destination for the billions of dollars held in debt funds ranges from leveraged buyouts to infrastructure projects, real estate deals and private companies.
Debt funds tend to invest in all elements of the capital structure except equity. They can provide senior, subordinated or mezzanine debt as well as asset-backed lending or distressed debt financing.
Oaktree Capital Management, for example, has invested in Countrywide, the UK estate agent, and taken control of loans secured against shipping assets.
Lone Star is carrying out a take-private deal of the property group Quintain, while M&G Investments, one of only two London-based debt funds in the top ten, has lent millions to “creditworthy” UK businesses that cannot secure bank finance through its UK Companies Financing Fund.