Schroders secures A$250m private debt mandate from Australian super fund

Schroders Capital has been awarded its first Australian private debt mandate from an unnamed industry superannuation fund.

The private markets investment division of global investment manager Schroders said the A$250m (€168m) mandate from the large super will cover corporate, real estate and infrastructure debt.

The mandate targets a 4.5% return over its Bloomberg AusBond Bank Bill index benchmark.

Nicole Kidd, Schroders Capital’s head of private debt for Australia, said: “We are seeing a great opportunity emerge in Australia which is bringing together investors looking for attractive returns while borrowers are looking for flexible capital.

“We also have access to Schroders’ global investment capability, bolstering our knowledge of local private markets and providing valuable additional information when making investment decisions.”

Kidd said Schroders Capital’s investment team covers the full spectrum of private debt across corporate, real estate, infrastructure; spanning senior, subordinated and unitranche.

“By leveraging this access to information, and our global network, we can offer customised entry points into the asset class for clients.”

Sam Hallinan, Schroders CEO for Australia, said: “This is not surprising as there are some key advantages of investing in private debt for superannuation funds.

“Superannuation funds are becoming increasing complex, dealing with more challenging paradigms, such as ‘Your Future Your Super’, and the ability to leverage relationships with key managers is becoming ever more important to them.”

Hallinan said private debt is becoming a sought after asset class for institutional portfolios, adding that investors are wanting to invest in assets that are non-correlated to equities, for instance, and that offer good diversification.

Private debt portfolios for institutions can also be customised to ensure best fit with their overall asset allocation strategy, Hallinan said.

“This is an important milestone in the build-out of our private assets business in this region,” Hallinan said.

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