Carlyle Seeking to Attract Wealthy Investors With Credit Fund

(Bloomberg) -- Carlyle Group LP is trying to get an edge with the wealthy and boost a credit business that’s struggled to catch up to its rivals.

The Washington-based alternative asset manager partnered with OppenheimerFunds to reach high-net-worth investors through a new long-term credit fund. The fund would give people access to structured credit, private loans, and distressed debt, letting individuals tap into the “full credit platform, which you’re not getting if you buy a BDC or products focused on plain-vanilla loans,” said Mark Jenkins, head of global credit for Carlyle.

Carlyle’s credit funds haven’t seen the same growth or high returns as some of the competition. Blackstone Group LP, Apollo Global Management LLC and KKR & Co. have built large credit investment businesses, some of which dwarf their private equity and real estate holdings. It’s an area of great importance to Carlyle’s new Chief Executive Officers, Glenn Youngkin and Kewsong Lee, who see the credit-business under Jenkins as a huge area of potential expansion for the firm.

“We brought in a great person to build the business,” Lee said in a Bloomberg interview this month. “One piece of credit I would give to Blackstone —- they have been able to identify unbelievably talented leaders, and the senior-most leaders and founders in the firm have been great in supporting them and allowing them to build businesses. That is what we are doing in investing behind Mark Jenkins.”

Carlyle has $34 billion of assets under management in its credit group. That includes a direct lending business, credit opportunities and distressed investing. Apollo has about $165 billion of assets under management in its credit unit and Blackstone’s GSO Capital Partners has $140 billion.

“This can set us apart in that there’s nobody today that offers the benefit of their entire credit platform,” Jenkins said, emphasizing that rival firms offer only more specific products to high-net-worth individuals. “We’re structuring this in a way that has the best end outcome for the investor.”

©2018 Bloomberg L.P.