Pengana Credit secures top bankers ahead of private debt launch
By David Ross – The Australian – original article
Two top bankers have been tasked to run newly created Pengana Credit as some of Australia’s wealthiest families clamour for access.
Pengana Credit, the brainchild of Sydney investment house Pengana Capital and Washington H. Soul Patterson, has hired veteran banker Nehemiah Richardson as chief executive. He has held senior roles at National Australia Bank and Latitude Financial Services, and has also spent years running Telstra’s mergers and acquisitions business.
Mr Richardson will be joined at the top by Charles Finkelstein, Citi Australia’s former treasurer, who takes on the job of chief investment officer.
The pair said they were keen to see what the new private debt business, which has received $200m in backing from Soul Patts, could do.
Mr Richardson said the plan was for a globally focused fund, with plans already underway to secure a coterie of managers who will deploy funds.
He said the $200m in seed capital from Soul Patts has already allowed Pengana Credit to start deploying funds and getting scale, with the size of the commitment enabling Australian investors more access to hedging.
“What we’re doing is allowing the opportunity to stay persistently invested up until you want to get your money out, we’ve been able to solve those challenges,” he said.
“We’re able to effectively democratise that access.”
Many private debt providers have operated on a model that sees capital locked away for some time before returns can be achieved.
Mr Richardson said the portfolio had seeded over “560 individual credits” across “generally defensive industries”.
He is looking at investing in companies that would weather any potential economic downturn, such as companies operating in software as a service with contracted revenues, consumer staples industries. As well as inflation or economic cycle-resistant sectors such as healthcare or infrastructure.
Mr Richardson said the private debt investment proposition, which was largely lacking in Australia, was proving a hit with high net wealth investors and family offices which had been contacting Pengana since the fund announced the plans in April.
Mr Richardson said he and Mr Finkelstein were also planning on investing in the fund when it opened for investor access.
Investors are currently sitting on a waiting list, with the rollout set to begin in the coming months.
The direct lending sector has boomed in recent years, as banks have pulled back in the face of a tougher regulatory environment following the Global Financial Crisis.
Mr Finkelstein said it was increasingly clear private debt would play a key role in financial markets.
“This is a very timely asset class,” he said.
Mr Finkelstein said the investment strategy would seek to target both industry sectors and an array of forms of lending, from direct lending to credit opportunities.
Pengana Capital CEO Russel Pillemer said the appointment of the two veteran bankers was a coup for the company.
Mr Pillemer said Mr Richardson and Mr Finkelstein were “outstanding operators in banking and financial services”.
“When combined with the previous commitment from our joint venture partners, Soul Patts, we’re incredibly excited to have brought this calibre of talent together.”
