Ely Place Partners Limited is pleased to announce that it has acted as placement agent to PennantPark Investment Advisers, LLC on its fifth comingled fund, PennantPark Senior Credit Fund Levered, LP.
PennantPark Closes on Leveraged Investment Vehicle in Senior Debt Strategy
New Commitments Increase Investment Capacity by $460 Million
NEW YORK, June 30, 2021 — PennantPark Investment Advisers, LLC (“PennantPark”) today announced the successful closing of its fifth comingled fund, PennantPark Senior Credit Fund Levered, LP (“PSCF-Lev” or the “Fund”), securing $460 million in additional investment capacity and taking another significant step forward in the growth of the firm’s middle market private credit investment business.
PSCF-Lev represents one of eight dedicated investment vehicles in PennantPark’s Senior Debt strategy, and is primarily focused on directly originated senior secured first lien floating rate loans with selective equity coinvestments to U.S. companies, with an emphasis on offering capital preservation and attractive risk-adjusted returns.
The Fund secured commitments from investors such as insurance companies, wealth managers, family offices, and both public and private pensions across North America, Europe, and Asia. From pre-COVID inception in mid-2019 through March 31, 2021, PSCF-Lev’s gross and net annualized returns were 17.7% and 15.3%, respectively,1 surpassing the Fund’s target net returns of 8-10%. Additionally, the Fund has deployed approximately 60% of capital as of its final close.
PennantPark Senior Credit Fund, LLC (“PSCF”), the unlevered sleeve of the vehicle, is holding its final close in December of this year. From pre-COVID inception in mid-2019 through March 31, 2021, PSCF’s gross and net annualized returns were 12.4% and 10.7%, respectively,1 surpassing target net returns of 6-8%. PSCF will be accepting commitments for the remainder of 2021 (through the final close).
PennantPark’s Senior Debt strategy is designed to capitalize on middle market loans utilizing fundamental credit analysis and deep industry expertise. The strategy allows investors to benefit from exposure to directly originated primary loans with attractive yields and relatively low leverage, selective secondary purchases, and equity coinvestments. PennantPark has a strong track record of generating significant value for investors in equity coinvestments which provide upside to portfolios built on stable, recurring cash flows.
“PennantPark’s ability to lend to companies while also selectively providing equity through our coinvestment program remains a key differentiator in our market. The first lien status of our loans provides capital preservation for our investors, while the coinvestment program adds significant additional upside and has helped drive our success across the market,” said Art Penn, Founder and Managing Partner of PennantPark. “Private credit investments provide consistent absolute returns in a low-yield environment while also capitalizing on attractive opportunities during times of market volatility.”
The latest fund closing follows recent firm developments such as the December 2020 final close of PennantPark Credit Opportunities Fund III, LP (“PCOF III”) and the August 2020 formation of PennantPark Senior Loan Fund, LLC (“PSLF”), a joint venture with Pantheon. Ely Place Partners assisted with fundraising for PSCF-Lev.
PCOF III follows PennantPark’s Opportunistic Credit strategy, which has four dedicated investment vehicles. From pre-COVID inception at the end of 2018 through March 31, 2021, PCOF III’s gross and net annualized returns were 33.0% and 27.4%, respectively,1 surpassing target net returns of 12-14%.
“The demand we received from our limited partners is evidence of the current environment and underscores the value of our team’s rigorous investment process and long-term track record since our founding more than 14 years ago across multiple market cycles, including the global financial crisis and the COVID-19 pandemic,” said Penn. “We are gratified by the continued support of high-quality, world-class institutional investors who have embraced PennantPark’s unique approach and entrusted us with the opportunity to capitalize on the attractive investment opportunities across private credit.”
PennantPark is a leading middle market credit platform, which today has $4.7 billion2 of assets under management. Since its inception in 2007, PennantPark has provided investors access to middle market credit by offering private equity firms and their portfolio companies as well as other middle market borrowers a comprehensive range of creative and flexible financing solutions. PennantPark is headquartered in New York and has offices in Chicago, Houston, and Los Angeles.
1 Net IRRs are from inception (May 2019, June 2019, and December 2018 for PSCF-Lev, PSCF, and PCOF III, respectively) through 3/31/21. Past performance is no indication of future performance. Important note: the reported fund-level Net IRR will typically be higher than individual investors’ performance because certain (GP-affiliated) LPs are exempt from management / incentive fees.
2 Assets under management (“AUM”) defined as investable capital, including committed and available investable capital, as of 3/31/21.