Tikehau Capital and UOB Kay Hian form $100m Asia private credit fund

The global alternative asset manager and stockbroker have contributed $50m each, and are aiming the fund at mid-sized corporates across Asia Pacific.

March 12, 2024

Tikehau Capital, a global alternative asset management group with around €17 billion ($18.6 billion) under management, has joined forces with Singapore-headquartered brokerage firm UOB Kay Hian (UOBKH), to launch a new private credit strategy.

Both Tikehau Capital and UOBKH will be contributing $50 million each in capital commitments to the strategy which seeks to provide financing to mid-sized corporates across Asia Pacific (Apac). The focus will be on growth, working capital, and refinancing lending to borrowers in resilient and defensive industries.

Tikehau Capital’s global institutional relationships in the private credit space will combine with UOBKH’s local networks.

This strategic collaboration is in line with Tikehau Capital’s strategy to continue to expand its global footprint, particularly across Asia, where it has been operating for a decade.

According to 2023 data from the International Monetary Fund and Preqin Pro, Asia’s allocation to private credit remains under-represented. Compared to Asia’s 36% contribution to global GDP, Asia comprises only 7% of global private credit assets under management, representing significant scope for growth of the private credit market in Asia.

Antoine Flamarion and Mathieu Chabran, co-founders of Tikehau Capital, said in a media release: "As Asian markets demonstrate continued robust growth and positive structural shifts, there is an ongoing demand among mid-market businesses in the region for funding to enhance working capital and refinance existing debts. Our partnership with UOBKH will give Asian mid-market businesses access to alternative funding sources, whilst simultaneously offering investors a unique opportunity to engage with private credit as an investment class".

In the same statement, Wee Ee Chao, chairman and managing director of UOBKH, commented: "We truly appreciate this partnership [with Tikehau Capital] and commitment as we embark on this journey together in leveraging the strength of our franchises to grow the Asia Pacific Private Credit Fund Strategy."

Law firm Dechert helped advise on the deal, and Thomas Kim, partner, Singapore at Dechert, said in a separate statement, “A rapidly expanding asset class in Apac, private credit presents significant growth opportunities for investors and businesses alike.”

Kim added: “The launch of this fund attests to the exciting interest and growth we are seeing in this asset class in th Apac region in particular.”

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