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Universities Superannuation Scheme buys $3.1 billion direct lending portfolio

credit suisse

Universities Superannuation Scheme, Liverpool, acquired a $3.1 billion middle-market financing portfolio from Credit Suisse, said a spokeswoman for the pension fund.

The £56 billion ($69.4 billion) pension fund will provide senior debt financing to global private equity and asset management companies to fund their investments in senior loans to medium-sized companies in Europe, following a deal with Credit Suisse.

The portfolio of outstanding loans to diversified specialist direct lending funds originated over the course of 2014 and 2015 at Credit Suisse, USS said in a news release. The funds are secured by an underlying portfolio of loans to medium-sized European companies, the news release added.

As part of the deal, Credit Suisse will provide services to USS, including loan servicing, credit monitoring, structuring and the origination of new financing facilities. Credit Suisse retains a minority interest in the portfolio.

“This transaction gives USS exposure to top-tier private credit managers through a high-quality portfolio of loans delivering an attractive risk-adjusted cash flow for the benefit of our members,” said Ben Levenstein, head of private credit and special situations at USS Investment Management, USS' in-house money manager, in the news release.

“USS' private credit strategy continues to look for innovative solutions to access return premia above those available in public markets,” Mr. Levenstein said.